Read in Chinese

Speaker:

Ms. Wang Chunying, deputy administrator and spokesperson of the State Administration of Foreign Exchange

Chairperson:

Mr. Chen Wenjun, director general of the Press Bureau of the State Council Information Office (SCIO) and spokesperson of the SCIO

Date:

April 21, 2023

Chen Wenjun:

Ladies and gentlemen, good morning. At today's press conference held by the State Council Information Office (SCIO), we are joined by Ms. Wang Chunying, deputy administrator and spokesperson of the State Administration of Foreign Exchange (SAFE). Ms. Wang will present the data on China's foreign exchange receipts and payments for the first quarter of 2023, and also take your questions.

Now, I will give the floor to Ms. Wang Chunying for a brief introduction.

Wang Chunying:

Good morning, everyone. Welcome to today's press conference. Now, I would like to brief you on China's foreign exchange receipts and payments situations for the first quarter of 2023 and then take your questions.

In the first quarter of 2023, there were still uncertainties in the international financial market, with an increasing downward pressure on the global economy and a slowdown in the tightening of monetary policy in major developed economies. Facing a complex external environment, China has followed the general principle of pursuing progress while ensuring stability, and has made concrete efforts to promote high-quality development under the strong leadership of the Communist Party of China (CPC) Central Committee with Comrade Xi Jinping at its core. Major macroeconomic indicators have stabilized, and the economy has maintained a momentum of recovery and development. China's foreign exchange market got off to a stable start, the exchange rate of the yuan against the US dollar increased slightly, and the cross-border capital flow became more balanced.

According to the data on foreign exchange settlement and sales by banks in the first quarter of this year, in US dollar terms, banks settled $546 billion and sold $561.3 billion, representing a deficit of $15.3 billion; or in yuan terms, banks settled 3.74 trillion yuan and sold 3.84 trillion yuan, recording a deficit of 105.5 billion yuan. For cross-border receipts and payments by non-banking sectors, in US dollar terms, banks registered $1.4850 trillion in foreign-related receipts and $1.4508 trillion in foreign-related payments for customers, representing a surplus of $34.2 billion; or in yuan terms, banks handled foreign-related receipts of 10.17 trillion yuan and payments of 9.93 trillion yuan for customers, recording a surplus of 232.9 billion yuan.

China's foreign exchange receipts and payments for the first quarter of 2023 show the following characteristics:

First, China's cross-border capital flows are generally stable. In the first quarter of 2023, the cross-border receipts and payments by non-banking sectors recorded a surplus of $34.2 billion, while the foreign exchange settlement and sales by banks posted a deficit of $15.3 billion. Specifically, the surplus reached a seasonal high before the Spring Festival in terms of cross-border receipts and payments by non-banking sectors, but it tended to reach a basic equilibrium in February and March. The balance in foreign exchange settlement and sales by banks fluctuated in a narrow range in January and February and was represented by a small deficit in March. To sum up, the supply and demand of domestic foreign exchange were basically in balance.

Second, the cross-border capital flows under the current account were stable, while that under the capital account ran smoothly and orderly. In the first quarter of 2023, the net inflow of capital under trade in goods continued to be relatively high, while the net outflow of capital under trade in services increased year on year, which was mainly attributed to the fact that the resident travelling abroad has increased but was still lower than its pre-pandemic level. The net inflow of foreign direct investment (FDI) in China remained, and the foreign investment in China's securities market showed a net increase. Meanwhile, China's outward direct investment and its holdings of foreign securities maintained a reasonable and orderly development trend.

Third, the foreign exchange sales rate was kept at a stable level for nearly one year, while the foreign exchange financing by enterprises remained stable. In the first quarter of 2023, the sales rate, a measure of customers' willingness to buy foreign exchange, which is the ratio of foreign exchange purchased by customers from banks to foreign-related foreign exchange payments made by customers, stood at 68%, basically the same as that in the fourth quarter of 2022. The sales rate for each quarter has remained at around 68% since the second quarter of 2022. In terms of financing, the outstanding domestic foreign exchange loans of market participants, such as Chinese enterprises, reached $281 billion by the end of February 2023, an increase of $9.7 billion from the end of 2022. By the end of March, the balance of foreign currency financing under international trade, such as import refinancing and forward letter of credit, stood at $73.1 billion, a slight decline of $3.7 billion from the end of 2022.

Fourth, the foreign exchange settlement ratio increased steadily, and the balance of enterprises' foreign exchange deposits remained basically stable. In the first quarter of 2023, the foreign exchange settlement ratio, a measure of customers' willingness to settle foreign exchange, or the ratio of foreign exchange sold by customers to banks to customers' foreign-related foreign exchange receipts, reached 64%, up by one percentage point from the fourth quarter of 2022. By the end of February 2023, domestic foreign exchange deposits held by Chinese enterprises and other market participants totaled $640.6 billion, an increase of $6.5 billion from the end of 2022.

Fifth, the volume of China's foreign exchange reserves remained basically stable. China's foreign exchange reserves increased by $56.2 billion from the end of 2022 to $3.1839 trillion at the end of March this year, mainly due to the combined effects of currency translation, asset price changes, and other factors.

Looking ahead, under the guidance of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, the SAFE will fully implement the guiding principles of the 20th CPC National Congress. We will work holistically to ensure both development and security, and continuously deepen the reform and opening up in the foreign exchange sector. More efforts will be made to advance the high-standard opening up under capital account steadily and orderly to facilitate cross-border trade, investment and financing, and to optimize the foreign exchange reserve operation and management system with Chinese characteristics. We will constantly improve the two-pronged "macro-prudential management and micro regulation" framework to guard against the risks and shocks from the external financial market, and maintain the stable operation of the foreign exchange market and national economic and financial security, in a bid to serve the high-quality development of the real economy.

The facts mentioned above are what I want to share with you on the main data of China's foreign exchange receipts and payments for the first quarter of 2023. Now, I'd like to take your questions. Thank you.

Chen Wenjun:

Now the floor is open for questions. Please identify the media organization you work for before posing your questions.

CCTV:

Since the beginning of this year, there have been some changes in the domestic and international economic and financial environment. What will you say about the performance of the foreign exchange market in the first quarter of this year? What are the new changes and features? Thank you.

Wang Chunying:

Overall, China's foreign exchange market has achieved a good start in the first quarter of this year. It can be observed that the main features are more stable performance in the exchange rate of the yuan, reasonable market expectations, and an autonomous balance of the supply and demand in the domestic foreign exchange market.

First, the yuan exchange rate was generally stable from a global perspective, with a slight appreciation despite two-way fluctuations. As of yesterday, the onshore exchange rates of the yuan rose by 1% against the US dollar from the end of 2022. In terms of multilateral exchange rate, the yuan exchange rate index rose by 1.3% according to China Foreign Exchange Trade System, while the emerging market currency index (EMCI) increased by 1.1% during the same period. Turning to the market movement: the trend of the yuan exchange rate has become more stable lately. Due to the effects of foreign economic and financial shocks, as well as seasonal factors, the yuan exchange rate fluctuated in the market throughout the first two months of this year, particularly around the Spring Festival. Since the mid-March, the yuan exchange rate has been steadily rising, as major economic indicators in China were improving, and the monetary tightening policy in major developed economies was narrowing in scope and slowing down in pace. As a result, the first finding we came to is that, from a global perspective, the yuan exchange rate has seen two-way fluctuations within a reasonable range and a slight appreciation since the beginning of the year.

Second, the exchange rate expectation of the market participants was stable, and the way they made foreign exchange transactions became more reasonable. We noticed that the indicators such as foreign exchange forwards and options have shown no apparent signs of one-way appreciation or strong expectation of depreciation in the yuan exchange rate. The market participants maintained a rational transaction behavior of "settling foreign exchange when the rate is high and buying foreign exchange when the rate is low". In February, the yuan depreciated because customers such as businesses and individuals exchanged foreign currency for yuan, which was why the settlement ratio rose by nearly nine percentage points this month from January. According to our analysis, customers had reasonable needs to sell foreign exchange when the yuan depreciated. It is observed that with the appreciation of the yuan in mid-to-late March, the willingness to buy foreign exchange was strong among business participants, and the foreign exchange settlement and sales by banks posted a deficit in March. Thus, in the first quarter, the exchange rate expectation of the market participants was stable, and their foreign exchange trading became more rational, showing an obvious sign of the rational trading mode mentioned above.

Third, the autonomous balance of the supply and demand in the domestic foreign exchange market was further consolidated. From the perspective of foreign exchange settlement and sales by banks, the foreign exchange market achieved an autonomous clearance in the first quarter of this year. As the foreign exchange market was supplied with foreign exchanges by banks reducing their holdings, overseas entities buying and selling of foreign exchanges in the interbank market, etc., it balanced the small deficit of foreign exchange settlement and sales by customers. From the point of view of the balance of payments (BOP) in recent years, China's current account surplus, foreign investment, and other sources of funds have been mainly balanced by outward investments by domestic market participants, thereby enabling some sort of automatic matching of the sources with using of foreign funds. According to the preliminary data, in January and February, the current account surplus and the FDI in China were still the primary source of foreign exchange funds for China. Foreign funds were mainly used as the outward direct investments and investments in overseas securities. This also explains some of the discussions about where our surplus has gone. In recent years, the People's Bank of China (PBC) has almost withdrawn its "regular" intervention in the foreign exchange market, so the source and using of foreign funds are mainly among market participants.

To sum up, the steady recovery of China's economy from the beginning of this year has laid a consolidated foundation for a good start for the foreign exchange market. Meanwhile, the role of yuan exchange rate as an automatic stabilizer for adjusting BOP has been more obvious, and the market participants have become more mature and rational and can better adapt to changes in the external environment. All of these ensured the stable operation of the foreign exchange market.

This is my answer to your question, thank you.

China News Service:

What's the situation about the inflow of FDI in recent years? What do you think about the prospect of FDI in China? Thanks.

Wang Chunying:

Direct investment reflects medium- and long-term investment intentions, and investors are more interested in the long-term development prospects of a country's economy and some of its fundamental advantages.

From a global perspective, China has always been a major destination for FDI. The COVID-19 pandemic has increased the volatility of the world economy and finance, which exerted huge impacts on the global FDI. In 2020, the outbreak of the pandemic constrained economic activity, so the global FDI plummeted. In 2021, the recovery of the world economy drove the rapid growth of FDI as it rebounded from a low position. In 2022, the global economic recovery slowed down, so did the growth of FDI, which gradually returned to its pre-pandemic level. The net FDI in BOP is calculated according to the unified international standard, which includes capital investment and earnings reinvestment. Many foreign-funded enterprises profit from their operations and may not remit all the money abroad. Many of them are optimistic about a country's economy, so the profits stay within the country and are reinvested. There are also shareholder loans, which fall into the category of direct investment. Overall, China has excelled globally in absorbing FDI, and the net inflow of FDI in China in the past decade was among the world's highest.

Speaking of prospects, what can foreign investors gain by investing in China? Foreign investors can share the investment, transformation, and market dividends of China's high-quality economic development by investing in China.

First, China's overall situation is stable, and the Chinese economy has maintained a medium-high growth in the past decade. The return on FDI in China is stable and at a relatively high level globally. Our calculations show that, over the previous five years, the return on FDI in China has been around 9.1%, while in Europe and the US around 3%. The return on FDI in emerging economies such as Brazil, South Africa, and India has been around 4% - 8%. It can be clearly seen that the return on FDI in China is among the highest.

Second, China has the world's best manufacturing capability. Its infrastructure is well-developed, and its industrial and supply chain systems are complete and stable. At the same time, the quality of the Chinese labor force is relatively high, with 240 million people having received higher education. All these continue to provide a good foundation for the innovation and development of multinational companies. Additionally, the Chinese economy is on the course of transformation into high-quality development, with new growth points springing up, such as the development of science and technology innovation and the expansion of opening up in the service sector, which will continue to attract the inflow of FDI.

Third, China has a large population, with the largest middle-income population in the world and a highly potential domestic consumer market, which provides more opportunities for foreign investors in production, sales, and services in China. Surveys by some foreign chambers of commerce and global management consulting firms, we have seen lately, show that as China's economy recovers, foreign investors are more confident in investing in China and more optimistic about its economic development prospects. We believe that foreign investors will continue to invest in the Chinese market steadily in the future.

On the policy front, China will adhere to a high-standard opening up, improve the business environment, and reduce market access to foreign investment to better serve the foreign-invested enterprises. The SAFE will continue to facilitate cross-border investment and financing and help stabilize and expand the scale of FDI. Thanks.

Economic Daily:

What is the current situation of foreign investors investing in yuan assets? What changes do you see in the future? Thank you.

Wang Chunying:

Thank you for your question. I am going to answer your question from the following aspects.

In recent years, the overall scale of foreign investment in yuan assets has risen, and China has gradually become the leading force in absorbing portfolio investment among emerging economies. Last year, under high inflationary pressure, the Fed rapidly tightened monetary policy, and as a result, both the exchange rate and interest rates of the US dollar rose significantly. The scale of cross-border bond investments absorbed by countries worldwide decreased greatly, and the stock markets of major emerging economies saw a retraction of funds. Under such circumstances, China's foreign exchange market and securities market remained stable, although China also faced the impact of Sino-US interest rate differentials on the yuan exchange rate and investment adjustments of foreign funds in the Chinese securities market. The investments of foreign central banks and banking institutions in China's bond market were relatively stable, and foreign capital in the China's securities market showed a net inflow overall. The changes in the scale of cross-border capital inflows and outflows under securities investment did not change the overall equilibrium of BOP in China.

With the improvement of the internal and external environment in recent months, foreign investment in Chinese securities was on an upward trend. First, China's economy has steadily recovered, and market expectations have been boosted. Foreign investors have become increasingly enthusiastic about investing in yuan assets. Second, due to multiple factors, the exchange rate and interest rates of the US dollar have recently fallen from their high levels, and the spread inversion of 10-year treasury bonds between China and the US has tended to converge, having narrowed by half from a peak of 1.5 percentage points to the current level of about 0.7 percentage points. In January 2023, the net increase in China's domestic shares held by foreign investors hit a record high; in March, the balance of China's domestic bonds held by foreign investors rebounded from February.

In the future, foreign investors will continue to invest in China's securities market, as they are attracted by several advantages of the renminbi assets: steady profitability, high investment value and strong appeal for investors seeking to diversify portfolio. I'll touch on each of these briefly.

First, the yuan's value is stable, which keeps foreign investors from big exchange losses. The yuan exchange rate has remained generally stable at an appropriate and balanced level in recent years. Even in 2022, when the external environment is complex and volatile, the fluctuation of the yuan exchange rate was significantly lower than that of the Japanese yen, the British pound, the euro, and major emerging market currencies. Thus, foreign investors will not suffer significant exchange losses in holding yuan assets.

Second, the yuan-denominated assets have strong appeal for investors seeking to diversify portfolio. China's economic cycle is not synchronized with that of major developed economies. The macroeconomic policy, the interest rate, exchange rate and asset prices in China are relatively independent, which endows yuan assets with a better diversification effect in global asset allocation. People who make investments understand this point, and appreciate it. At the same time, China's bond market is the second largest in the world in terms of size, which means we have good liquidity. With the characteristics of safety and liquidity, the yuan assets have gradually become quasi-safe assets.

Third, the yuan bond price is less volatile with stable returns. From a global perspective, volatility in yuan bond returns is low. In most cases, the higher the volatility, the riskier the security, so it means that the investment return of yuan bonds is more stable. According to the calculation, last year, the volatility of annualized monthly return of the yuan treasury bond index was 2.4%, and that of the US dollar bond was 6.6%. Through such a comparison, we can find out that the yuan bond price is less volatile with stable returns.

Fourth, China's securities market is undervalued and has good investment prospects. No matter the price-to-earning (P/E) ratio or price-to-book (P/B) ratio or other indicators, the current valuation of A shares is relatively low, so the investment value is comparatively high, and the potential risk is relatively low.

Overall, China's economy will progressively improve, its financial market will steadily open up, and there is still potential for foreign investment to enter the country. At present, foreign investors' current holdings of both onshore stock and bond portfolios are at low levels, so there is ample room for them to invest in China's securities market.

This is my response to your question. Thank you.

ThePaper.cn:

Recently, some developed economies kept on raising interest rates. Have there been any changes to China's external debt, and how does the SAFE evaluate China's current external debt level? Thanks.

Wang Chunying:

We can observe and evaluate changes in China's external debt from macro and micro perspectives.

At the micro level, market participants were more rational and cross-border financing adjustment was moderate. In recent years, market participants have been able to view the changes in interest rates and foreign exchange rates in a more rational way, and their expectations have become more stable. In line with the actual needs of trade and investment, we utilized and adjusted domestic and foreign financing reasonably, thus observing more smooth changes in the external debt. Fed's adoption of quantitative easing (QE) has lowered the financing costs in US dollars from 2020 to 2021. Therefore, the external financing demand of market participants expanded moderately, and the outstanding external debt of traditional financing types, such as cross-border deposits, loans, and trade credit, grew at an average annual rate of 8%, which was significantly lower than the 21% annual growth rate during the last round of Fed's QE from 2009 to 2013. In 2022, the Fed began to tighten monetary policy. The balance of financing external debt fell by 10%, which was markedly lower than the 34% decline in 2015. In the first quarter of this year, the outstanding financing external debt further stabilized. These changes show that if there is no excessive leveraging in the early stage, there will not be substantial deleveraging in the later stage, which is my explanation of the rise and fall of the external debt scale from the perspective of micro perspective.

From a macro perspective, the total amount of China's external debt is reasonable, with its structure being constantly optimized and risks controllable. First, the scale of external debt is compatible with China's economic development. It is a relatively desirable and benign pattern of external debt development for a country if it can fully absorb external funds to support its domestic economic development within a moderate range. In recent years, China's external debt has generally grown steadily, and the ratio of outstanding external debt to GDP has always remained within the range of 14%-16%. Second, the structure of China's external debt has been constantly optimized. At the end of last year, the proportion of the outstanding external debt in domestic currency and the outstanding medium- and long-term external debt reached 45%, up by 7 percentage points and 11 percentage points respectively from the end of 2016. About 30% of China's external debt is the domestic yuan bond held by overseas investors, of which most are medium- and long-term investments. Therefore, the overall risk of external debt servicing is relatively low. Third, the main external debt indicators are within the safety line, and the synergy between external assets and liabilities is enhanced. As of the end of last year, the ratio of external debt to GDP, ratio of external debt to exports, debt service ratio, and ratio of short-term external debt to foreign exchange reserves of China were all within the international safety line and far lower than the overall level of developed countries and emerging markets. At the same time, according to the statement of BOP, China presents itself as a country with net foreign assets. At present, the overseas assets held by foreign exchange market participants, excluding foreign exchange reserves, are close to $6 trillion, of which $3.5 trillion is in securities, deposits, loans, and other assets with good liquidity. Under the regulation of market mechanism, external assets and liabilities can be reallocated among different market participants, which provides sufficient financial support for them to undertake external debt repayment obligations.

According to our observation from micro and macro perspectives, we believe that the scale of China's external debt is reasonable, and it is expected to maintain a stable development trend in the future. SAFE will continue to improve cross-border investment and financing facilitation in the upcoming phase and work holistically to meet market participants' needs for cross-border financing while maintaining stable development and security. Meanwhile, we will also continue to keep a close eye on the security of external debt. Thanks.

Hong Kong Bauhinia Magazine:

According to the data just released, China's foreign exchange market has started well this year. In your opinion, will this good start last? What would you say about the future trend of China's foreign exchange market? Thank you.

Wang Chunying:

My answer to your question is yes, and China's foreign exchange market's strong start will continue. According to the economic trend at home and abroad and the characteristics of China's foreign exchange market, it has a better foundation to maintain stable operations under the dual support of sound macroeconomic fundamentals and its inherent resilience.

On the one hand, major economic indicators are improving, further consolidating the internal foundation for the smooth operation of the foreign exchange market. With the stabilizing and recovery of China's economy, the GDP in the first quarter increased by 4.5% year on year, which shows the resilience, potential and vitality of the Chinese economy. The market expectation has also improved significantly. The IMF estimates that China's GDP will grow 5.2% this year, 2.2 percentage points higher than that of last year. Besides, many world-renowned investment banks have also raised their expectations for China's economic growth, and most of them estimate that China's GDP growth will exceed 6%. While on the contrary, the major developed economies are facing increasing downward pressure. The global economy is forecast to grow 2.8% in 2023, down 0.6 percentage points from that of last year. A series of data shows an obvious gap between domestic and foreign economic growth, and the foundation for the stable operation of the foreign exchange market is very good. At the same time, China will unswervingly deepen reform and expand high-standard opening up to the outside world. The SAFE will continue implementing policies to stabilize foreign trade and investment. These will further enhance the smooth operation and healthy development of the foreign exchange market. Since the beginning of this year, with the slowing down of the Fed's tightening monetary policy, the market generally expects that the Fed's interest rate hike may end. Because the dollar may lose momentum for sustained appreciation and given the interest rate gap between China and the US has been closing, there will likely be less of an external influence on China's foreign exchange market.

On the other hand, the resilience of China's foreign exchange market has been enhanced, enabling it to better adapt to changes in the external environment. More elasticity has been seen in the yuan. The market participants have developed a better understanding of the two-way fluctuation of the exchange rate, so their expectation of the exchange rate has become more stable. Besides, the role of the yuan exchange rate as an "automatic stabilizer" of macroeconomic adjustments and international payments has increased. The yuan has been more widely used in cross-border transactions, and its share in cross-border payments was close to 50% in 2022 and increased further in the first quarter of this year, which helps reduce the risk of currency mismatch in cross-border transactions. With the promotion of foreign exchange risk neutrality, more enterprises came to understand how to manage risks in foreign exchange through various publicity and learning and became more adapted to exchange rate fluctuations.

The fact that China's foreign exchange market has been more mature and the market participants have become more rational is an internal positive factor for the stability of the foreign exchange market. Therefore, China's foreign exchange market is better positioned for stability. At the same time, there are still unstable and uncertain factors in the external environment, so we will continue to strengthen statistical monitoring and deepen analyzing various influencing factors. Besides, the SAFE will continue to sum up the experience of preventing and dealing with external risks and improve macro-prudential management and micro regulation to safeguard the stability of China's foreign exchange market and national economic and financial security. Thanks.

21st Century Business Herald:

Just now, you mentioned that SAFE has been promoting risk neutrality awareness in Chinese enterprises. What other measures will SAFE take this year to guide Chinese enterprises, particularly micro, small and medium-sized enterprises (MSMEs), to avoid exchange rate risks? Thanks.

Wang Chunying:

Before answering this question, I once again ask you to continue to help us carry out publicity. In recent years, we have intensified our efforts to raise the awareness of risk neutrality of Chinese enterprises and have achieved remarkable results. We will continue to proceed with the work this year. SAFE always encourages enterprises to adopt appropriate strategies to manage exchange rate risk exposure according to their actual situation. There are many ways for enterprises to control exchange rate risks. In addition to hedging through derivatives, the use of yuan settlement is also a good way. And trade financing, whether late payment or early payment, late collection or early collection, is also a great method to hedge risks. According to the survey of SAFE, in the first quarter of this year, a considerable number of enterprises have adopted methods, including yuan settlement, hedging operations, adjusting settlement methods, and changing the speed of reimbursement of goods to manage the exchange rate risk. These are all excellent methods.

Efforts will be made to promote enterprises to establish a sense of risk neutrality, especially among MSMEs, and to make them do better in exchange rate hedging. To this end, we will work on the following aspects and strive to enhance enterprises' ability to improve the quality and efficiency in risk management of foreign exchange.

First, we will continue to offer guidance on raising their awareness of exchange rate risk neutrality. For example, we will expand the coverage of publicity in this aspect. Especially, we will offer targeted guidance to those enterprises with potential demands that have not carried out or rarely used hedging operations. Besides, we will provide more detailed and targeted exchange rate risk management guidelines. We plan to work with the State-owned Assets Supervision and Administration Commission (SASAC) to compile cases of hedging guidelines for state-owned enterprises and prepare a set of cases of enterprise exchange rate risk management. We count on media friends to help us publicize.

Second, we will support financial institutions to enhance service capacity building. We will improve the special assessment of exchange rate risk management of financial institutions on serving enterprises and guide and encourage banks to optimize the credit margin system, especially for MSMEs. At the same time, we will enhance the business capacity of bank branches to provide better services to more market participants, particularly MSMEs. Doing so will form a long-term mechanism for banks to serve enterprises in the area of exchange rate risk management. We will continue to make steady and concrete efforts in this regard.

Third, we will provide more support for MSMEs in exchange rate hedging. We continue to pool efforts to optimize the cost-sharing mechanism among the government, banks, and enterprises so as to reduce the hedging costs of MSMEs. At the same time, we need to ensure that the existing policies continue to be effective. Government departments have taken numerous actions over the last two years to lower the hedging expenses for MSMEs. At the same time, we encourage the development of new forms of trade and support the integrated foreign trade service platform in providing foreign exchange hedging services for MSMEs.

Finally, I would like to stress again that enterprises must establish awareness of exchange rate risk neutrality. We encourage enterprises to base themselves on the main business, adhere to financial stability and sustainable development, and keep exchange rate risk exposure within a controllable range. Besides, they should prudently arrange the currency structure and maturity of assets and liabilities and choose appropriate exchange rate hedging strategies. Thanks.

Yicai.com:

This year, the external situation is still severe and complicated, and our foreign trade faces challenges. What has the SAFE done to stabilize foreign trade recently? What new measures will be taken? Thank you.

Wang Chunying:

In terms of stabilizing foreign trade, SAFE has further advanced the reform and opening up in the foreign exchange sector and promoted foreign trade growth with high-quality facilitation policies. What we have done is as follows: First, we expanded the scope and improved the quality of policies to facilitate foreign exchange receipt and payment in trade for high-quality enterprises. Last year, with broadened service scope, these policies benefited more SMEs nationwide. By the end of March this year, an amount of $1.4 trillion has been granted to facilitate foreign exchange receipt and payment in trade for high-quality enterprises. Next, we will continue to improve the coverage, quality, and efficacy of these facilitation policies and encourage banks' enthusiasm, initiative, and creativity in implementing such policies, so that more enterprises operating with integrity can enjoy policy convenience. We will strive to foster a market environment where "the more honest the enterprise is, the more convenient the procedure will be" and "the more compliant the bank is, the more independent the audit will be".

Second, we step up the high-level opening up for cross-border trade and investment. We encourage more high-tech companies and specialized and sophisticated enterprises to borrow external debts independently within a certain quota and expand their financing channels. By the end of last year, enterprises in 17 provinces or municipalities directly under the central government had borrowed external debts under the facilitation quota, with an average interest rate of 2.4%. It has significantly reduced the financing cost of enterprises, which is conducive to business operations and trade. At the same time, SAFE implemented the pilot program of external debt registration in which the pilot enterprises are not required to register each specific case in the utilization of external debts. It effectively facilitates market participants' use of external debts and decreases their "foot-cost". Optimizing the integrated cash-pooling of both domestic and foreign currencies for multinational companies, we have greatly saved their costs, improved the efficiency of bank-enterprise business handling, and promoted the facilitation of investment and financing. In the future, we will continue to push ahead with pilot projects on a higher level of opening up in foreign trade and investment and instruct the implementation of policy measures in the four free trade zones (FTZs) in China, such as the Lin-gang Special Area of China (Shanghai) Pilot Free Trade Zone. We will evaluate and improve relevant pilot policies promptly, and constantly optimize such policies through pilot projects. We aim to promote the facilitation policies further so that more businesses can enjoy the convenience.

Third, we will urge enterprises to improve their exchange rate risk management capacity. More efforts will be made to promote the awareness of exchange rate risk neutrality among enterprises and to reduce the hedging costs for MSMEs.

Fourth, we will expand the application scenarios of cross-border financial service platforms. At present, seven financing scenarios and three foreign exchange facilitation scenarios have been successfully launched at the cross-border financial service platform, which has more than 500 participating banks and serves more than 80,000 participants, with a total financing amount of $250 billion, and facilitating foreign exchange payments of over $880 billion. The cross-border financial service platform is very useful. We have publicized it in detail in the past, and you can learn more about it. In the future, we will continue to expand the application scenarios at the platform, and facilitate cross-border trade, investment, and financing of SMEs to ensure the steady and sound development of the foreign-related economy. The more enterprises and banks use the platform, the more SMEs will enjoy the benefits of policies to facilitate foreign trade, investment, and financing.

In terms of stabilizing foreign trade, what the SAFE has done and will do is to promote foreign trade growth through high-quality facilitation policies. Thanks.

Phoenix TV:

The current account surplus for 2022 was high, creating favorable conditions for stabilizing the foreign exchange market. The growth of the global economy is expected to decline this year. What's your opinion on the performance of the current account this year? Thanks.

Wang Chunying:

Your observation is correct. In recent years, China's current account has shown strong stability, and the current account surplus has continued to grow steadily, which has played a positive role in stabilizing the BOP and the foreign exchange market. This year, people are concerned about the impact of changes in external demand and the resumption of cross-border flows of people. I will give my response and analysis from these two aspects. Overall, China's trade in goods and services has been more effective and efficient in recent years, which has helped the country maintain a reasonable current account surplus and given the foreign exchange market considerable support.

The trade surplus in goods will remain relatively high, as structural changes have gradually taken place in foreign trade in recent years, which have provided more support to exports. First, new drivers of trade growth are emerging as China's manufacturing sector continues to transform and upgrade, its industrial chain and supply chain become more stable, and its products become more competitive. The total value of exports of electric vehicles, lithium batteries, and solar cells rose by 67% in yuan terms in the first quarter of this year, driving exports by 2 percentage points. Compared to last year, this pulling effect is even stronger. Second, China continued to enhance regional trade cooperation and made positive progress in diversifying trade partners. In the first quarter of this year, China's exports to ASEAN and countries along the Belt and Road Initiative increased by 28% and 25%, respectively. Third, digital trade, represented by cross-border e-commerce, is booming. Cross-border e-commerce exports grew rapidly in the first quarter, significantly driving the export growth. What about imports? Currently, we have agreed on further boosting domestic investment and consumption. Under this consensus, the import volume will keep growing, and commodity prices may fall from high levels. Overall, imports are expected to remain stable.

As for trade in services, high-quality development of trade in services is gradually producing results, which will contribute to the balanced development of China's import and export of trade in services. In recent years, China's manufacturing and service industries have integrated and developed. The rapid development of trade in productive services, especially computer information services, business services, and other emerging services, will drive the income growth from exports of services. For example, China is speeding up the construction of "digital China". From 2020 to 2022, the average annual growth rate of trade in digitally deliverable services exceeded 10%, much higher than the overall 3% growth rate of trade in services. For the first time ever in 2022, China's trade in services that can be delivered over information and communication technologies (ICT) networks recorded a surplus of more than $10 billion, showing the country's growing international competitiveness in digital products and services. On the other hand, cross-border travel consumption, which you are concerned about, has been the main form of China's import of trade in services. We can see from the experience of the steady recovery of cross-border travel in major Asian countries that it will take some time to restore the Chinese cross-border travel consumption.

Based on the situation of trade in goods and services, China's current account will post a reasonable surplus this year, and it will remain within an equilibrium range. Thanks.

Chen Wenjun:

Thank you, Ms. Wang. Thanks to friends from the media. Today's press conference is hereby concluded. Goodbye.

In case of any discrepancy between the English and Chinese texts, the Chinese version is deemed to prevail.

Read in Chinese

Speakers:

Mr. Zhao Zhiguo, chief engineer and spokesperson of the Ministry of Industry and Information Technology (MIIT) and director general of the Information and Communications Management Bureau of the MIIT

Ms. Tao Qing, director general of the Bureau of Operation Monitoring and Coordination of the MIIT

Chairperson:

Ms. Shou Xiaoli, deputy director general of the Press Bureau of the State Council Information Office (SCIO) and spokesperson of the SCIO

Date:

April 20, 2023

Shou Xiaoli:

Ladies and gentlemen, good afternoon. Welcome to this press conference held by the State Council Information Office (SCIO). Today, we are joined by Mr. Zhao Zhiguo, chief engineer and spokesperson of the Ministry of Industry and Information Technology (MIIT). He will brief you on the development of industry and information technology in the first quarter of 2023, and take your questions. We're also joined by Ms. Tao Qing, director general of the Bureau of Operation Monitoring and Coordination of the MIIT.

Now, I'll give the floor to Mr. Zhao for a brief introduction.

Zhao Zhiguo:

Ladies and gentlemen, friends from the media, good afternoon. Thank you for your consistent interest in and support for the industry and information technology sector. Next, I'll brief you on the sector's development in the first quarter of this year.

Since the beginning of this year, in the face of a complex and fast-changing external environment and various difficulties, risks and challenges, the MIIT, under the strong leadership of the Communist Party of China (CPC) Central Committee with Comrade Xi Jinping at its core, has thoroughly implemented the guiding principles of the 20th CPC National Congress and earnestly put into practice the decisions and deployments made at the Central Economic Work Conference and the annual "two sessions." The MIIT has prioritized ensuring stable growth and proactively collaborated with all localities and government departments in implementing related policies to accelerate the resumption of work and production, enhance efforts to ease businesses' difficulties, and maintain stable performance of industrial sector. In general, the industry and information technology sector has started off stably this year, with a positive trend to follow.

First, the industrial sector has maintained stable operation, evidenced by three key factors. For starters, industrial production has rebounded steadily. In the first quarter of this year, the added value of China's industrial enterprises above the designated size rose by 3% year on year, a 0.3 percentage point increase from the fourth quarter of 2022, reversing the continuous downward trend in growth since last October. According to statistics from the China Association of Automobile Manufacturers (CAAM), the production and sales of automobiles in March increased by 15.3% and 9.7% year on year, respectively, and that of new energy vehicles (NEVs) in the same period surged by 44.8% and 34.8% year on year, respectively. The second aspect is that manufacturing investment kept growing steadily. In the first quarter of this year, manufacturing investment grew by 7% year on year, 1.9 percentage points higher than fixed-asset investment in the country, maintaining a comparatively fast growth rate despite the high comparison bases over the past two consecutive years. The third aspect is that the leading role of major industrial provinces has become more prominent. The industrial growth rate of major industrial provinces, including Hebei, Shandong and Jiangsu, is significantly higher than the national average. The industrial sectors of Guangdong, Zhejiang and other provinces have also seen an upturn since March.

Second, advanced manufacturing demonstrated a sound growth momentum. General Secretary Xi Jinping stressed that we must firmly pursue high-quality development as our primary task. Premier Li Qiang's first research trip outside Beijing also focused on the development of advanced manufacturing, which sent a clear message of China's resolve to vigorously develop the sector. We have made every effort to boost advanced manufacturing and ensure that manufacturing becomes higher-end, more intelligent and more eco-friendly. We have carried out industrial foundation reengineering projects and research projects on major technologies and equipment. Major progress has been made in some sectors. For example, the ARJ21 aircraft have transported over 6.55 million passengers and have recently been put into commercial operations overseas. The world's largest container vessel, with a capacity of 24,188 TEUs, has been deployed for service in China. The country also successfully developed its first homegrown extracorporeal membrane oxygenation (ECMO) device and granted approval for it. We also implemented projects for intelligent manufacturing and promoted the digital transformation of industry. The three major functional systems of the industrial internet, namely those concerning networks, platforms and security, have been established, and the scale of the core industry has surpassed 1.2 trillion yuan ($170 billion). We also expedited our efforts to guide the transformation of industry toward eco-friendly and low-carbon development. We accelerated efforts to develop emerging industries such as the NEV and photovoltaic sectors. In the first quarter of this year, fixed-asset investment in the high-tech manufacturing industry increased by 15.2% year on year, and the production of emerging products such as NEVs and solar cells surged by 22.5% and 53.2% year on year, respectively.

Third, the empowering role of the information and telecommunications sector has continued to grow. We have spared no effort to develop new types of infrastructure and ensure it effectively supports high-quality socioeconomic development. In the first quarter of this year, the business revenue of China's telecom industry increased by 7.7% year on year. We worked to promote the construction of the "dual gigabit" internet in a steady manner. Over 2.64 million 5G base stations have been built, and the number of gigabit internet users has exceeded the 100 million mark. We continued to promote the integration of internet applications into industrial sectors, with 5G technology fully applied in 52 major sectors of the national economy. We improved the capacity of applications and services and further enhanced the supply of mobile internet applications and services. We accelerated the promotion of demonstration cases for elderly-friendly and barrier-free internet applications across the country. We also coordinated development and security by rolling out policies that bolster the development of industries concerning data security, strengthening the protection of key information infrastructure, and ensuring the safe and stable operation of basic telecommunications networks.

Fourth, the environment for industrial development was further improved. We adhere to an approach characterized by an efficient market and a well-functioning government, aiming to create an ecosystem conducive to industrial development. We thoroughly implemented the development plan for the industrial and information technology sector during the 14th Five-Year Plan period, and organized efforts to formulate work plans for stabilizing growth in major sectors such as automobiles and electronics. Regarding the pressing difficulties and problems facing small- and medium-sized enterprises (SMEs), the MIIT worked with related government departments and rolled out a series of policy measures to help businesses stabilize growth, adjust their structures, and strengthen their capacities. The MIIT also launched the fifth round of work to develop "little giant" enterprises with high growth potential, advanced technology and strong market competitive edge. It also convened this year's working session for the State Council's inter-ministerial joint meeting on reducing business burdens. The MIIT made efforts to precisely align industries with financial resources, and the national platform in this regard has helped enterprises raise more than 500 billion yuan in total.

Of course, we need to be aware of the current difficulties and challenges facing the development of the industrial sector. However, the fundamentals underpinning the long-term robust growth of China's industrial sector remain unchanged, and we maintain our confidence in it. Looking forward, the MIIT will continue to follow the guidance of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era and earnestly implement the decisions and deployments made by the CPC Central Committee and the State Council. The MIIT will act with firm confidence, push for innovation, stabilize the development of major sectors, and support the growth of leading enterprises and enterprises with high growth potential, advanced technology and strong market competitive edge. The MIIT will work to boost existing strengths, develop new advantages, and shore up weak links in a bid to ensure the sustained upturn of the industrial sector and accelerated growth of the information and telecom industry in the second quarter. This will lay a solid foundation for the accomplishment of the annual targets and tasks.

That concludes my introduction. Next, my colleague and I will take your questions.

Shou Xiaoli:

Thank you, Mr. Zhao. The floor is now open for questions. Please identify the media organization you work for before asking your questions.

China Media Group:

Since the beginning of this year, the industrial economy has rebounded at a faster pace and the PMI has stayed in expansionary territory for three consecutive months. How would you evaluate the performance of the industrial economy at present? Moreover, what measures will be taken to promote the steady growth of the industrial economy? Thank you.

Zhao Zhiguo:

Thank you for your questions. In the first quarter, China's value added of industrial enterprises above the designated size grew by 3% year on year, up a 0.3 percentage point from the fourth quarter of 2022. Overall, it has stabilized and rallied. In terms of industries, the outputs of the general equipment, automobile, and chemical fiber industries have increased year on year after declining year on year in the previous two months. Meanwhile, the outputs of the non-ferrous metals, building materials, electrical machinery, and special equipment industries grew more rapidly over the last two months. In terms of regions, the production in the eastern and northeastern regions has continued to recover. Among the top 10 provinces regarding value added, six provinces posted higher growth than the national level in the first quarter. Guangdong and Zhejiang have demonstrated sound recovery momentum, with positive growth in the first quarter. In terms of key products, the production of crude steel, generator sets, and refrigerators increased by 6.1%, 7.5%, and 8.4% year on year, respectively. Moreover, plastic products, bags and suitcases, general-purpose machinery, and automobiles still have advantages in exporting, with a double-digit increase year on year.

Next, we will focus on the following work.

First, we will foster a sound development environment for industries. We will fully implement policies and measures to keep growth stable, formulate and implement work plans to ensure steady growth in key sectors and continue to provide stronger policy support. We will coordinate between the MIIT and governments at provincial levels and foster collaboration among departments solidly and meticulously. We will support major industrial provinces to serve as the strong pillar of the industrial economy. We will give full play to the principal role of enterprises and provide strong support for developing leading enterprises and specialized and sophisticated enterprises that produce new and unique products to foster synergy in maintaining the steady growth of the industrial economy.

Second, we will work to steadily increase both the volume and quality of exports. The momentum in the export of advantageous products will be consolidated. We will offer more support to foreign trade firms in the manufacturing sector and provide good services for key foreign-invested enterprises and projects in the manufacturing sector. We will cooperate with relevant departments to implement policies and measures to ensure steady growth in foreign trade and make efforts to stabilize the export of industrial products.

Third, we will promote the recovery of domestic demand at a faster pace. We will act to increase the variety, raise the quality, and build brands of consumer goods and raw materials. Campaigns will be launched to promote new energy vehicles, smart appliances, and green building materials in rural areas. We will foster the local specialty food industry. With all these efforts, we will promote consumption through high-quality supply. We will make extensive efforts to advance major projects in the industry and information sector set out in the 14th Five-Year Plan. The plan to guide technology transformation and upgrading of industrial enterprises will be implemented. We will guide financial institutions to increase the supply of medium- and long-term loans to the manufacturing industry and actively expand effective investment.

Fourth, we will continue to create a strong impetus for growth. We will accelerate the innovative development of strategic emerging industries such as 5G, artificial intelligence, biological manufacturing, and intelligent connected vehicles and make a big push to develop advanced manufacturing to create new engines of growth. We will promote the development of the digital economy to foster new growth drivers for the economy. We will fully and meticulously implement measures to support stable growth, structural adjustments and capacity enhancement in SMEs. We will continue to improve services for enterprises, boost their confidence, and nurture a batch of SMEs into specialized and sophisticated enterprises that produce new and unique products.

We believe that advancing key projects under the 14th Five-Year Plan, implementing the strategic plan for boosting domestic demand, and introducing policies and initiatives to keep foreign trade stable will provide strong support for the sustained recovery of the industrial economy. With the effective release of the vitality of market entities, the potential of consumer consumption, and the impetus for industrial upgrading, China's industrial economy in the second quarter will further improve and lay a sound foundation for fulfilling our tasks and goals for the year. Thank you.

Yicai:

At the Central Economic Work Conference at the end of last year, it was proposed that China would work on boosting domestic demand. In the government work report delivered during the two sessions this year, it is emphasized again that we will take solid steps to implement the strategy of expanding domestic demand. What measures will the MIIT take to further promote automobile consumption and boost domestic demand? Thank you.

Tao Qing:

Thank you for your question. In accordance with the decisions and plans of the CPC Central Committee and the State Council, the MIIT has actively worked with relevant departments to analyze the development of the automobile industry and develop policies and measures to further promote automobile consumption. We have continued to unlock the consumption potential and create multiple application scenarios to advance the high-quality development of the automobile industry. In 2022, we worked with relevant departments to launch preferential policies such as reducing the purchase tax of eligible passenger vehicles, promoting spending on new energy vehicles in rural areas, and guiding local governments to adopt measures to promote consumption, including increasing the quota of vehicle license plates for cities that have restrictions on car purchases and offering subsidies for purchasing vehicles. By taking all these measures, we have advanced steady growth in China's automobile industry, with production volume and sales up 3.4% and 2.1%, respectively, significantly contributing to the recovery of the macroeconomy. Since the beginning of 2023, new energy vehicles still maintain relatively rapid growth despite the current sluggish automobile market. From January to March, China produced 1.65 million and sold 1.586 million new energy vehicles, with a year-on-year increase of 27.7% and 26.2%, respectively.

Next, acting upon the decisions and plans of the CPC Central Committee and the State Council, the MIIT will further unleash the potential of consumer demand, energize the consumer market, and stabilize spending on automobiles and other big-ticket items. We will work with relevant departments to introduce policies and initiatives to maintain stable automobile consumption and expand domestic demand and ensure the implementation of current policies and initiatives. We will improve the "double credits" management provision for corporate average fuel consumption and new-energy vehicles. We will also launch pilot programs in establishing pioneering zones for comprehensive electrification of vehicles in public areas in cities. At the same time, we will guide local governments to uphold the principle of fairness and justice when making pro-consumption policies, as well as safeguard the market order for fair competition to continue improving the overall competitiveness and development quality of China's automobile industry. Thank you!

Zhonghongwang.com:

The high-quality development of the ICT industry has effectively generated vigor for the development of the digital economy. We have seen that the ICT industry achieved relatively rapid growth in the first quarter. What are the specific highlights and achievements? Thank you.

Zhao Zhiguo:

Thank you for your question. In the first quarter, we thoroughly implemented the decisions and plans of the CPC Central Committee and the State Council, adhered to the general principle of pursuing progress while ensuring stability, and pushed the high-quality development of the ICT industry to new heights.

First, the momentum is strong and steady progress has been made in the development of the industry. Emerging businesses have developed rapidly, with the revenue of businesses such as internet data centers, cloud computing, and the Internet of Things increasing by 24.5% year on year, driving the growth of telecommunications services revenue by 4.8 percentage points and gradually becoming a new growth driver for the ICT industry. Telecommunications services revenue grew steadily, with total revenue reaching 425.2 billion yuan in the first quarter, up 7.7% year on year. Furthermore, the total business volume of telecommunications services increased by 18% year on year. The overall performance of the ICT industry has demonstrated sound momentum.

Second, the foundation is more solid and cyber capacity continues to be enhanced. Network infrastructure has been improved. As of the end of March, more than 2.64 million 5G base stations have been built and over 17.93 million network ports can provide gigabit network services, meaning that "the gigabit optical network covers every city" and "every county can access 5G services." A supply system of computing power with gradient optimization has been primarily established. The total computing power has developed rapidly. China's total computing power scale now ranks second globally, with an annual growth rate of nearly 30%. The development of IPv6 has been advanced. IPv6 has developed from being usable to being able to provide good services. The data traffic of IPv6 surpassed IPv4 for the first time, accounting for over 50% of mobile network traffic, bringing in an era of the internet predominated by IPv6-based networks.

Third, the application is wider and access to high-speed businesses has been accelerated. The scale of connection has continued to increase. As of the end of March, the number of 5G mobile phone users has reached 620 million and the number of gigabit optical networks users has surpassed 100 million. The number of mobile Internet of Things users totals 1.984 billion, with 53.8% of "things" connected to the mobile internet. The foundation for the development of a world where all things are connected has been consolidated. Integrated applications have been advanced and 5G has been applied in 52 national economic categories. There have been over 50,000 cases of applying "dual-gigabit" infrastructure nationwide, featuring a 5G network and a gigabit optical network. And the mobile Internet of Things has been applied on a large scale in the construction of digital cities, smart transportation, mobile payments, and other areas.

Fourth, the experience and accessibility of convenient user services have been improved. Universal telecommunications services have been further promoted. Internet coverage in rural and remote areas has continued to be improved. The application of the 5G network in rural areas has been advanced. All these have provided strong support for the rural revitalization strategy. The sense of gains for users has been improved. In the first quarter, the download rates of mobile and fixed broadband networks have increased by 59.9% and 15.1% year on year, respectively. Rates for mobile internet services have dropped. Capacities for information accessibility have been enhanced. Progress has been made in improving internet applications for the convenience of senior citizens. We have also guided the promotion of a variety of excellent cases of improvements to mainstream websites and mobile phone apps nationwide.

Going forward, we will prioritize working in the following three areas to promote the development of the ICT sector and provide solid support for advancing high-quality economic and social development.

First, we will consolidate the development of digital infrastructure. We will introduce policies and initiatives to advance the coordinated development of the building of new information infrastructure, advance the infrastructure construction of broadband access services in border regions, expand the coverage of gigabit optical networks, promote cloud-network integration to strengthen information infrastructure in small- and medium-sized cities and advance the high-quality development of the mobile IoT. With all these efforts, we will advance the construction of new information infrastructure in an integrated way. 

Second, we will accelerate technological and industrial innovation. We will promote breakthroughs in core technologies in key fields, including 6G, optical communications, and quantum communications, and research frontier technologies such as artificial intelligence, blockchain and digital twins. We will break through the bottleneck of core technologies in key fields to enhance resilience and security in industrial and supply chains.

Third, we will promote integrated applications across sectors. We will advance integrated applications of new-generation ICT such as 5G and gigabit optical networks in vertical industries, information consumption and areas that are important to people's lives and promote the large-scale application of the industrial internet. We will develop a demonstration model for innovative applications in key areas. By doing so, we will contribute to the digitalization of industries. Thank you.

People's Posts and Telecommunications News:

This year is the last year to implement the three-year action plan (2021-2023) for the innovative development of the industrial internet. According to the plan, leapfrog progress will be made in the overall development of the industrial internet during the three years. What will you focus on this year to achieve this goal? Thank you.

Zhao Zhiguo:

Thank you for your question. The industrial internet is the strategic infrastructure for a new type of industrialization. It also serves as a crucial base for the in-depth integration of the digital and real economy. Since implementing the action plan over two years ago, we have adopted a moderately proactive approach and completed the infrastructure building. The analysis system for industrial internet identification has covered 31 provinces (autonomous regions, municipalities) and 40 sectors, providing services for over 250,000 enterprises. A multi-layered system consisting of comprehensive, featured, and professional industrial internet platforms has been developed. The amount of equipment connected to key platforms now exceeds 81 million. We have adopted a demand-oriented approach and further promoted integrated applications. The industrial internet has been applied to 45 national economic categories and 166 subcategories, covering over 85% of industrial categories. In the first quarter, we launched 218 industrial internet demonstration projects, including 5G factories, industrial internet parks, and public service platforms. We also created a batch of application models for factories and industrial parks in understanding and applying the industrial internet and enabling them to carry out the transformation with guts and knowledge so as to speed up digital transformation. Currently, the total output value of the core industry has surpassed 1.2 trillion yuan, increasing by 15.5% year on year.

Next, we will focus on large-scale application and high-quality development and prioritize three aspects: policies, technologies and applications. We will guide all regions and sectors to make greater efforts towards leapfrog development of the industrial internet, thus providing stronger support for advancing a new type of industrialization.

First, we will fully play the leading role of policies and strengthen institutional guarantees. We will formulate guidelines on the high-quality development of the industrial internet and advance the application of the "5G Plus Industrial Internet" in terms of industrial supply, in-depth application, and industrial cluster development to improve the top-level design. We will deepen the cooperation between industry and finance and the integration between industry and education, direct more investment from different types of capital, and cultivate high-level, versatile, and skilled talents to further create a sound development environment.

Second, we will pursue innovation-driven development and strive to make technological breakthroughs. We will launch a new round of innovative projects for industrial internet development, promote breakthroughs in core technologies in key fields of the industrial internet and their industrialization, break the bottleneck in technologies for large-scale application, and enhance the security capacity of the industrial internet. We will make and implement a batch of standards for emergency use and promote large-scale application with standardization. We will foster more diversified, high-quality and professional solutions to further enhance the supply capabilities of the industrial internet.

Third, we will advance coordination between industrial and supply chains and the industrial internet and move faster to promote large-scale use of industrial internet applications. We will actively promote close coordination between industrial and supply chains and the industrial internet. Focusing on key sectors, we will formulate guidelines on the integrated application of the industrial internet in key sectors such as electronic information and engineering machinery; moreover, we will advance the action to promote the application of the industrial internet identification to promote the wide application of the industrial internet in key industrial chains. By concentrating on key enterprises, we will give full play to the principal role of leading enterprises in bringing upstream and downstream enterprises, especially SMEs, to be integrated into the industrial internet. Focusing on key regions, we will launch the campaign to promote the application of the industrial internet in 1,000 industrial parks in 100 cities to advance the application of industrial internet in industrial parks and clusters of industries at a faster pace and bring about the emergence of more good cases for the large-scale application of the industrial internet. Thank you!

21st Century Business Herald:

In the first quarter of this year, the MIIT issued the list of SME industrial clusters with local features in 2022, drawing wide attention from all sectors of society. Can you talk about the progress related to this work? What follow-up measures will be taken to advance the recognition and cultivation of SME industrial clusters with local features? Thank you.

Tao Qing:

Thank you for your questions. SME industrial clusters with local features are located within counties. These clusters, characterized by their focus on leading industries with SMEs playing a dominant role, have distinctive advantages and features and core competitiveness. The MIIT has focused on six aspects, including improving the advantages of leading industries, advancing digital transformation, accelerating green and low-carbon development, deepening openness and cooperation, and enhancing governance and services, to foster clusters of industries. We have made clusters a fertile ground for developing SMEs into specialized and sophisticated enterprises that produce new and unique products, a carrier for promoting the regional economy, and a focal point for ensuring security and stability in industrial and supply chains. 

The first batch of 100 SME industrial clusters with local features has remarkable effects in the following four aspects. First, the clusters bring together a significant number of quality SMEs. Hosting more than 280,000 SMEs, the clusters register a total output of over 1.8 trillion yuan. Among them, there are 55 manufacturing individual champions, 294 specialized and sophisticated "little giant" companies, 1,487 specialized and sophisticated SMEs that produce new and unique products, and around 5,000 innovative SMEs. Over 20% of the enterprises in the clusters are quality SMEs. Second, the clusters have significantly strengthened and upgraded weak links in industrial and supply chains. The clusters have developed high-level and professional supporting capacity in key links in industrial and supply chains of major industries, such as high-performance materials, smart chips, precision instruments, propulsion systems for new energy vehicles, and industrial robots. Third, we have seen their initial effects on propelling local economic growth. The leading industries in these clusters, which are all local pillar industries, contribute 87% of the clusters' output and play a crucial role in advancing the high-quality development of county economies. Fourth, the governance and service system for these clusters continues to improve. Over 70% of the clusters have enjoyed services provided by national public service demonstration platforms for SMEs. Nearly 90% of the clusters have established mechanisms for promoting the development of industries. Over 90% of the clusters have built mechanisms for protecting SMEs' legitimate rights and interests. A cluster governance model featuring extensive consultation, shared benefits, joint construction, and joint governance has emerged.

We plan to foster another 100 SME clusters for distinctive local businesses nationwide this year. We will fully implement the guiding principles of the 20th CPC National Congress and the plans made at the Central Economic Work Conference and the Two Sessions, and further advance the work on SME clusters for distinctive local businesses. First, we will guide the clusters to develop leading industries and strengthen the core competitiveness of SMEs. We will enhance the vitality of county economies and improve the resilience of industrial and supply chains and the supporting capacity at key links. Second, we will provide guidance and evaluation for the development of clusters. We will carry out publicity for cases of excellent clusters, promote typical experiences, and step up quality management of clusters that have been recognized to ensure that solid progress will be made in the development of clusters. Third, we will launch research and introduce policies and measures to promote the development of clusters. We will enhance policy guidance and resource coordination, build a hierarchical system for cultivating clusters, and guide and support local governments in cultivating a batch of clusters at the provincial level. Thank you.

China Electronics News:

Recently, the MIIT hosted the first National Industry and Finance Cooperation Conference, building a bridge of communication and collaboration between the industrial and financial sectors. Could you please elaborate on that? Going forward, what measures will the MIIT take to advance new industrialization and boost China's strength in manufacturing and cyberspace at a faster pace? Thank you!

Zhao Zhiguo:

Thank you for your questions. The CPC Central Committee and the State Council have attached great importance to giving full play to the role of finance in supporting the real economy, especially the manufacturing industry. The MIIT, together with finance, financial regulation, and other departments, has actively implemented the decisions and plans of the CPC Central Committee and the State Council, taken innovative steps to advance industry and finance cooperation, and introduced a series of policies and measures to give financial support to the real economy.

We have carried out innovative practices of industry-finance cooperation in 51 pilot cities nationwide and continue to optimize the environment for financing and industry-finance cooperation. We have established strategic cooperation with 21 financial institutions, focusing on supporting the advanced manufacturing industry and serving the real economy. We have set up the national industry-finance cooperation platform, hosting nearly 190,000 quality enterprises in the industry and information sector and over 1,500 financial and investment institutions, and helping enterprises obtain 513.62 billion yuan in financing. As a major channel, the platform supports the application of re-lending facilities to support technological innovation. It has supported over 4,100 national demonstration enterprises for technological innovation, manufacturing individual champions, and specialized and sophisticated SMEs that produce new and unique products, with financing of over 270 billion yuan. Meanwhile, to promote the virtuous cycle of science and technology, industry, and finance, we have worked with financial and investment institutions to launch special pilot projects for the integration of science and technology, industry, and finance, and jointly explore the whole-chain service system for the commercialization and application of scientific and technological advances.

According to the report to the 20th CPC National Congress, by 2035, we will basically achieve new industrialization. The report emphasizes that we must continue to focus on the real economy in pursuing economic growth and that we will advance new industrialization and move faster to boost China's strength in manufacturing and cyberspace. The new industrialization is the industrialization of high-end, smart, and green production. It is the industrialization of collaborative innovation among small, medium, and large enterprises and the simultaneous development of the "four modernizations." It is also the industrialization of in-depth integration of digital and real economy, creating huge development opportunities for industry-finance cooperation.

Next, together with relevant departments, the MIIT will continue to deepen industry-finance cooperation and jointly advance new industrialization through consistent efforts. First, we will summarize experiences and take practical actions to put the outcomes of the first National Industry and Finance Cooperation Conference into practice and advance industry-finance cooperation to deliver more solid outcomes. Second, we will explore possibilities for combining new technologies, new industries, and new business forms with finance to promote synergy between industrial development, scientific and technological innovation, and modern finance. Third, we will give full play to the role of the national industry-finance cooperation platform, shore up weak links, build up strengths, and reinforce the foundation of industrial and supply chains. We will focus on major projects, key programs, and major enterprises, advance innovation in financial products and services, and pool together financial resources to transform and upgrade traditional industries, reinforce and extend competitive industries, cultivate and develop emerging industries, and make plans for future industries in advance. Thank you.

People.com.cn:

Recently, the MIIT and other 10 departments jointly issued guidelines on fostering traditional robust food production areas and the local specialty food industry. What measures will be taken according to the guidelines to advance the high-quality development of the food industry? Thank you.

Tao Qing:

Thank you for your question.

The food industry brings profits to those who work on the land and happiness to those who eat the food. It concerns people's livelihoods and is also one of China's key industrial sectors. 

In the first quarter of this year, the food manufacturing industry has maintained steady growth, with a strong momentum for recovery. Traditional robust food production areas and local specialty foods have become crucial carriers and critical drivers for the development of the food industry. With the improvement in people's living standards, people have a stronger demand for quality, nutritious, delicious and healthy food with a unique history and culture. Fostering traditional robust food production areas and the local specialty food industry will not only better meet people's ever-growing needs for a better life but also play a significant role in promoting local economic and social development, rural revitalization, and the realization of common prosperity. 

This year, the MIIT, together with other 10 departments, has issued guidelines on fostering traditional robust food production areas and the local specialty food industry, guiding localities to make full use of their resource endowment and actively unleash the potential for industrial development to create growth drivers for the food industry. The guidelines set out development goals for traditional robust food production areas and the local specialty food industry. It plans to initially create a development pattern for local specialty food by 2025, comprising leading enterprises whose revenues surpass 10 billion yuan, clusters whose revenues exceed 100 billion yuan, and industries whose revenues are above 1 trillion yuan. Specifically, we will foster more than five traditional robust food production areas with revenues over 100 billion yuan, 25 leading enterprises with revenues above 10 billion yuan, and a group of famous local specialty food brands nationwide and typical cases of industrialization of local specialty food.

Going forward, the MIIT will work with relevant departments to make concerted efforts throughout the industrial chains of the food industry to advance the high-quality development of the local specialty food industry. First, we will speed up the construction of large-scale crop and livestock bases for quality agricultural products to ensure a stable and reliable supply of production materials for local specialty foods. Second, we will improve techniques, technologies, and equipment to ensure product quality while raising production and processing efficiency. Third, we will promote the development of clusters of specialty industries and enhance coordination throughout industrial chains to promote small, medium, and large enterprises to pursue development through greater synergy. Fourth, we will improve the inheritance of local traditional food culture and processing techniques to improve product brand awareness and influence while maintaining local specialty food's original taste and flavor. Thank you.

Bauhinia Magazine:

In recent years, the integrated application of ICT has deepened and injected new impetus into high-quality economic and social development. What specific roles has it played? And what are the considerations for follow-up work? Thank you.

Zhao Zhiguo:

Thanks for your questions. The ICT sector is the strategic, fundamental, and pioneering sector to support economic and social development. Over the years, with the full implementation of the national cyber development strategy and the Digital China strategy, we have seen a significant improvement in the quality of ICT services. The integration of ICT into areas related to the national economy and social development has continued to be advanced. It mainly has three features.  

First, the integrated application of ICT has empowered the real economy at a deeper level. The new generation of information technology, such as 5G, has been deeply integrated into key areas of the real economy, including manufacturing, transportation, and tourism. Recently, the MIIT has worked with the Ministry of Culture and Tourism to introduce policies and documents concerning 5G smart tourism, actively expanding the new space for tourism development. 5G technology and artificial intelligence have been quickly applied to core production links. Construction of 5G-connected factories has been accelerated, bringing about profound changes in the production mode and pattern in the manufacturing sector.

Second, the integrated application of ICT has contributed to the construction of a digital society at a higher level. The application of smart medical care has been promoted at a faster pace. Over 80% of the pilot programs for 5G enabled healthcare services have been covered by 5G networks. Initial results were delivered in the development of smart education. The application of 5G technology in scenarios such as interactive online teaching and vocational training has continued to be deepened. Steady progress has been made in the construction of digital villages. Recently, we have worked with multiple departments to issue policies and documents, quickly advancing rural construction, governance and industrial development through digitalization. The digital government governance service efficacy has been significantly improved. 

Third, the integrated application of ICT has improved people's lives in more areas. Mobile internet applications have thrived, reaching 2.61 million. That is to say, we use such apps in study, work, and life and their number has amounted to 2.61 million, greatly facilitating people's lives. We have launched campaigns to promote information consumption in districts and counties to contribute to rural revitalization, built platforms for exchanges and interaction between urban and rural areas, and helped farmers to increase their income. Digital technologies have been adapted for the convenience of senior citizens and have met the most prominent and pressing needs of senior groups aged 60 and above for digital life. The online retail sales in the first quarter nationwide stood at 3.3 trillion yuan, up 8.6% year on year. 

This year marks the last year for carrying out several three-year action plans, such as the coordinated development of "Double Gigabit" networks, the comprehensive and coordinated development of 5G technologies, and the development of new types of data centers. Next, after completing the missions, we will make good use of integrated applications to continue to create growth divers for industries.

First, we will improve the supply of new technologies and products to create a strong engine for empowerment through integrated applications. We will carry out the action of empowering through enhanced computing infrastructure and promote the cloud-edge-terminal collaboration and integration of computing, storage, and operation. We will focus on 5G, integrated circuits and other key areas, and improve the supply of basic software, hardware, and core electronic components. We will strengthen the generic technology R&D and industrialized and coordinated development of artificial intelligence. 

Second, we will strengthen application guidance in key sectors and areas to set up the primary platform for empowerment through integrated applications. We will carry out the projects for the large-scale application of 5G technologies and guide the release of the guidelines for developing the 5G sector to push forward its application in industries. We will guide national pilot zones for innovative AI applications to offer open access to typical application scenarios to promote the upgrading of technologies and products.

Third, we will promote small, medium, and large enterprises to pursue development through greater synergy to forge the principal force for empowerment through integrated applications. We will cultivate a group of leading enterprises in industrial chains, specialized enterprises that use sophisticated technologies to produce new and unique products as well as champion companies in the manufacturing industry segments, and develop a hierarchical development pattern. We will encourage large enterprises to build digital platforms and share data resources and capacities with SMEs to lower the thresholds for the transformation of SMEs. Thank you!

Shou Xiaoli:

The last two questions, please.

CCTV.com:

Recently, China and France signed a cooperation agreement, setting the record for the largest single order by value that Chinese shipbuilders have ever received. How did the shipbuilding industry perform in the first quarter of this year? Thank you.

Tao Qing:

Thank you for your question. In the first quarter of 2023, the shipbuilding industry has rebounded. While registering stable performance, the industry also has demonstrated good momentum for growth, made steady progress and improved quality. According to statistics, in the first three months, the completed volume of shipbuilding in China reached 9.17 million deadweight tons (DWT). New shipbuilding orders amounted to 15.18 million DWT, increasing by 53% year on year. At the end of March, the volume of holding orders stood at 11.452 billion DWT, up 15.6% year on year.

First, the industry registered stable performance with good momentum for growth. From January to March, China's completed volume and new and holding orders of shipbuilding in deadweight tonnage accounted for 43.5%, 62.9% and 50.8% of the global market share, ranking first in the world. China's shipbuilding industry led the world in terms of orders for 10 out of 18 mainstream ship types in 2021.

Second, the industry has made steady progress while ensuring stability. Breakthroughs have been made in high-end ships. As of the end of March, all six container ships with a TEU (20-foot equivalent unit) capacity of 24,000 delivered globally were built at Chinese shipyards. China's shipbuilding companies seized the favorable opportunity when the car carrier market rebounded, and took all 24 orders globally for building car carriers in the first quarter of this year. Additionally, smooth progress has been made in building China's first self-developed large cruise ship, with over 91% of construction completed. Its equipment tuning work is well underway and interior installations are nearing completion. The cruise ship is expected to be delivered at the end of 2023.

Third, the industry has improved quality while ensuring stability. The quality of shipbuilding orders has been significantly enhanced and green development has been accelerated. From January to March, the structure of new shipbuilding orders received has been optimized, with CGT/DWT ratio standing at 0.485, marking the best level in history. Since the beginning of 2022, the orders of green-energy-powered ships have taken up 50% of new shipbuilding orders. As you mentioned, a series of deals concerning the construction of green and low-carbon large container ships were inked between China State Shipbuilding Corp and French shipping group CMA CGM, comprising 12 dual-fuel methanol-powered container ships with a capacity of 15,000 TEUs and four 23,000 TEUs dual-fuel liquefied natural gas (LNG) powered ones, worth more than 21 billion yuan in total.

On the whole, playing an increasingly greater and more influential role in global industrial and supply chains, China's shipbuilding industry will also be advanced from a new and higher starting point. Thank you.

Voice of China, China Media Group:

We noticed that the MIIT recently issued a notice on further improving the service capacity of mobile internet applications, aiming to optimize the services and enhance user experience. What progress has the MIIT made in promoting ICT for people's livelihoods this year? What's the next plan? Thank you.

Zhao Zhiguo:

Thank you for your questions. ICT services concern the vital interests and personal experiences of the public. The MIIT has embraced a people-centered development philosophy and taken practical measures to enhance people's livelihoods. In the first quarter of this year, we have improved institutions and regulations. We issued notices about further improving the service capacity of mobile internet applications and introduced a range of standards, including evaluation standards, to protect the rights and interests of app users. We have set up a complaint-handling center for radio frequency interference and further improved our service systems. We have also expanded the range of service applications available to users. The average speed of mobile networks has been on the rise. Applications such as livestreaming and online tourism have thrived. The number of active apps reached 2.61 million. The mobile internet has been deeply integrated into people's production, life, studies and work, providing quality services with quick accessibility. We have improved digital services to bring more benefits to people. We have continued to carry out activities with themes such as "Do Practical Things for the People," "Heartfelt and Dedicated Services," and "Service Hubs." We selected and promoted a batch of excellent cases of improving services in frequently encountered scenarios for the convenience of senior citizens to provide more considerate and heartwarming digital services. We have addressed key issues and conducted tests on the technologies of 50,000 apps. Moreover, we have brought attention to the violations of regulations committed by 101 apps and SDKs, with a specific emphasis on addressing concerns related to unwanted redirection or "shake-to-open" advertisements, in order to purify the service environment.

Next, we will give priority to the work in the following aspects.

First, we will improve the service system to create a sound environment. We will prioritize the improvement of the sector's conduct, rectify any misconduct, and expedite the development of a comprehensive modern service system. We will work to ensure that documents already issued are fully implemented, refine policies and measures, and make detailed standards and regulations to guide mobile internet applications to improve service quality throughout the process. We will accelerate the development of the public services platform for mobile internet applications and enhance technological capacities for monitoring and testing, risk warning, origin-tracing and authentication. We will improve mechanisms for industry self-regulation, coordinated services, evaluation and oversight to create a sound environment encouraging the pursuit of excellence and mutual reinforcement.

Second, we will provide enhanced services to improve user experience. We will accelerate the development of 5G and 1000M fiber optic networks, advance universal telecom services, and further expand internet coverage in both breadth and depth. We will promote the application of technologies and innovation in models and continue to expand service areas and scenarios. We will upgrade the functions of internet applications specially designed for the convenience of senior citizens, ensuring that services are more convenient and accessible to them. We will advance online and cross-regional handling of telecom services, improve customer services via video communication, and simplify the variety and quantity of plans to enable people to have easy access to and worry-free use of services and continue to improve their sense of gain and satisfaction.  

Third, we will strengthen comprehensive governance to protect users' rights and interests. We will focus on the pressing difficulties and issues that concern the public most and work to resolve acute problems. We will strengthen app governance throughout all stages and regulate service behavior such as software installation and uninstallation, automatic renewals, and pop-up windows. Spamming activities will be curbed on a regular basis. We will collaborate with relevant departments to strengthen prevention at the source and promote call blocking anti-harassment services. We will strengthen the integrated technical prevention of telecom and internet fraud. The "card cutting campaign" targeting fraudulent schemes involving SIM cards and IOT cards will be advanced. We will step up efforts to advance the application of the 12381 SMS platform for early warning of fraud and promote a service that enables citizens to inquire about all mobile phone cards registered under their own ID numbers. With all these efforts, we will take practical steps to safeguard property security and the legitimate rights and interests of the people. Thank you!

Shou Xiaoli:

Thanks to all the speakers and the media participants for your valuable contributions. Today's briefing is now concluded. Goodbye!

Translated and edited by Zhu Bochen, Xu Kailin, Yuan Fang, Yang Xi, Zhang Junmian, Zhou Jing, Wang Wei, Wang Yiming, Liu Sitong, He Shan, Li Huiru, and Jay Birbeck. In case of any discrepancy between the English and Chinese texts, the Chinese version is deemed to prevail.

Read in Chinese

Speakers:

Mr. Wang Jiayi, vice minister of education and vice president of the Organising Committee of the Chengdu 2021 FISU World University Games

Mr. Zhou Jinqiang, vice minister of the General Administration of Sport of China and vice president of the Organising Committee of the Chengdu 2021 FISU World University Games

Ms. Zheng Bei, vice governor of the People's Government of Sichuan Province and vice president of the Organising Committee of the Chengdu 2021 FISU World University Games

Mr. Wang Fengchao, mayor of Chengdu Municipal People's Government, and vice president and secretary-general of the Organising Committee of the Chengdu 2021 FISU World University Games

Chairperson:

Mr. Chen Wenjun, director general of the Press Bureau of the State Council Information Office (SCIO) and spokesperson of the SCIO

Date:

April 19, 2023

Chen Wenjun:

Ladies and gentlemen, good morning. In 100 days, the 31st International University Sports Federation (FISU) Summer World University Games will be held in Chengdu, Sichuan province. For today's press conference, we have invited four vice presidents of its organizing committee to meet with you, introduce preparations for the games, and answer your questions. The four vice presidents are Mr. Wang Jiayi, vice minister of education; Mr. Zhou Jinqiang, vice minister of the General Administration of Sport of China; Ms. Zheng Bei, vice governor of Sichuan province; and Mr. Wang Fengchao, mayor of Chengdu city.

Now, I will give the floor to Mr. Wang Jiayi.

Wang Jiayi:

Good morning, friends from the media. It's a pleasure to meet with all of you today, 100 days before the opening of the 31st FISU Summer World University Games. On behalf of its organizing committee and the Ministry of Education, I would like to express our sincere gratitude for your long-term care, support and help.

The Chengdu 2021 FISU World University Games (Universiade) will be the first large-scale international sporting event held in an open manner in China since the outbreak of the COVID-19 pandemic. It bears the concern and trust of the Central Committee of the Communist Party of China (CPC) and the State Council and has garnered high attention from both domestic and international communities. The event serves as an important international sports competition and cultural celebration, as well as an important platform for promoting exchanges and integration among young university students around the world. I would now like to briefly introduce the three main reasons why this Universiade is of such significance.

First, this is a hard-earned Universiade. Since winning the bid to host the event in December 2018, Sichuan province and Chengdu city have put in a huge amount of hard work. Particularly over the past three years, the COVID-19 pandemic has had a profound impact on the global economy and society, forcing the Chengdu Universiade to be postponed twice. Nevertheless, we have remained steadfast in our solemn commitment to the FISU and the world's young university students. We have invested significant manpower, as well as material and financial resources, adapted to the changing circumstances, overcome challenges and obstacles, and made every effort to prepare for the Universiade.

Second, this is a Universiade of great significance. Sport embodies the aspirations of nations and peoples for strength and prosperity, and young people are the hope for the future of nations and peoples. The Chengdu Universiade will create a platform for fair competition, communication and exchanges, enhancing understanding and developing friendship among young university students and sports professionals from all over the world. It will undoubtedly contribute to promoting cultural exchanges and mutual learning between civilizations, advancing the building of a global community with a shared future, and creating a better future for the world.

Third, this is a Universiade destined to be truly spectacular. After four years of preparations, Chengdu has built exceptional venues and facilities, cultivated a rigorous and professional team to organize the games, and planned a variety of educational, cultural and sporting exchange activities. I believe that young university students from all over the world will not only have the opportunity to realize their personal sporting dreams here, but also have the opportunity to experience the international flair of charming Chengdu, the unique glamor of Sichuan, and Chinese culture. They will have a distinct and wonderful experience there, taking Chengdu as a window to get closer to China, understand China and comprehend China.

At the just-concluded spring meeting of delegation heads for the Chengdu Universiade, the FISU, as well as delegation heads from various countries, highly praised the preparations for the Chengdu Universiade. Let us all look forward to Chengdu delivering a "simple, safe and splendid" Universiade to the world.

Finally, we welcome friends from the media to continue to follow and participate in promoting the Chengdu Universiade.

Not long ago, I visited the news center of the Universiade, and it has been beautifully built. It is world-class and among the best of its kind globally. I welcome everyone to visit and cover the games from there. Thank you, everyone.

Chen Wenjun:

Thank you, Mr. Wang. Now, let's welcome Mr. Zhou Jinqiang for his brief introduction.

Zhou Jinqiang:

Friends from the media, good morning. We are now just 100 days away from the opening of the Chengdu Universiade, and preparations have entered the final stage. Competition organization is key to the success of the event, and is currently the primary focus of our preparations. Thanks to the efforts made in the early stages, phased tasks for the competition organization work for the Chengdu Universiade have been smoothly completed. Now, I would like to update you on the competition organization work.

First, the competition organization team has been assembled and established.

The Ministry of Education and the General Administration of Sport have jointly put together a team of core personnel to carry out the competition organization work for the Chengdu Universiade. They are responsible for providing professional guidance and technical supervision in terms of venue equipment, facilities, registration and scheduling. This March, we convened a special meeting on the competition organization work in Beijing. At the end of this month, we will hold another meeting to clarify the competition organization team's work requirements, review the competition organization's progress and the coordination with venue teams for each project, and ensure that the universal competition policy is implemented at the venue level. Furthermore, we have selected 1,077 domestic technical officials to work alongside international counterparts to complete the competition refereeing and organizational management tasks, among others.

Second, the in-competition organization system has been established.

The in-competition organizational system has been established, with the teams responsible for the venues serving as the backbone and the organizing committee, committees for each division, and venue teams collaborating closely and efficiently. The operation and emergency response plans for the command and coordination center have been finalized, and the center has been undergoing trial operations since March 3. Prior to the opening ceremony, we will conduct a series of test contests to get prepared for real games and improve our organizational work and command system so as to ensure smooth and efficient operation.

Third, test events are progressing in an orderly manner.

The Chengdu Universiade underwent a lengthy preparation period due to postponement. As early as 2021, we organized 17 single national games as test events to evaluate the organization and operation of the games as well as the logistical services. During these events, we identified a list of problems and continued to optimize our work. In early June, we will conduct comprehensive rehearsals and tests for the entire games' progress to ensure that the goals, standards, and needs of the games will be met during the event. We will test and check out the operation of venues, equipment, and command centers to further enhance our operational capabilities.

Fourth, registration for the games is underway.

Registration for the Chengdu Universiade is divided into four stages: intentional registration, pre-registration, group registration, and individual registration. Currently, we are in the group registration stage, and we are committed to providing excellent services to welcome young athletes from around the world to Chengdu. At the same time, we are actively working on logistical services for the delegations that have already registered for the games, providing detailed information about procedures for arrival and departure, accommodations, dining, training, and competition to ensure that those procedures proceed smoothly and on schedule.

That concludes my update on the preparations for the Chengdu Universiade. We invite the media to provide coverage and support for the event. Thank you for your attention.

Chen Wenjun:

Thank you, Mr. Zhou. We now give the floor to Ms. Zheng.

Zheng Bei:

Dear friends from the media, good morning. First of all, I'd like to express my sincere gratitude to friends from the media for attending today's press conference, as well as other people from all walks of life who are interested in Sichuan's socioeconomic development.

Since Chengdu successfully bid for the 31st FISU World University Games in 2018, we have been preparing for the event under the strong leadership from the CPC Central Committee and the State Council, as well as comprehensive guidance and support from the Ministry of Education, the General Administration of Sports, and relevant departments. In accordance with the requirements of "simplicity, safety, and excellence," we have mobilized all of Sichuan province's resources to prepare for the games. At present, all preparations for the games are almost complete. Now, I'd like to brief you on our progress.

First, we have established a highly efficient collaborative work mechanism. Members of the organizing committee, including the Ministry of Education and the General Administration of Sport, have designated personnel to form a special task force working on-site in Chengdu. At the provincial level, a coordination group was established with the provincial Party secretary and governor serving as co-leaders and 47 provincial-level departments fully participating in strengthening overall coordination throughout the province. The Chengdu executive committee has been adhering to a flat management structure to promote high-quality and efficient progress in all aspects of the preparation work.

Second, we have built state-of-the-art competition venues. A total of 49 venues for the games were already put into operation in 2021. This year, these stadiums have once again undergone multiple tests to ensure they meet international competition standards. In May and June, a series of test events will be held to further optimize the functionality of these venues.

Third, we have planned diversified exchange programs for the upcoming event. During the games, we will host the Chengdu FISU World Conference , the 2023 Chengdu Biennale , and activities showcasing the Chinese intangible cultural heritage. Our goal is to provide a relaxing and delightful atmosphere for young people from all over the world to deepen mutual understanding and enhance friendships. In addition, we will offer various travel routes to visitors, including visits to world heritage sites, allowing them to experience the rich history, diverse culture, and beautiful landscapes of Sichuan.

Fourth, we have been improving our services that are meticulous and professional. We have engaged with all participating delegations to improve our services at the athletes' village. We have improved the entire service system, including those related to guests' arrival, accommodation, transportation, and other services. Our aim is to ensure that all participating delegations from around the world can have a comfortable stay, enjoy delicious food, and participate in the games with peace of mind. At the same time, we have recruited 20,000 volunteers for the games and received over 1.3 million applications for city volunteer services. We have also improved training for our service teams to ensure that they will provide warm and hospitable services throughout the games.

Recently, the spring meeting of the delegation heads for the World University Games was held in Chengdu. The FISU and delegations attending the meeting visited the competition venues and the athletes' village. They have reached a consensus on issues related to registration, visas, arrival, transportation, medical services, and more, and highly recognized our preparation work. The Chengdu Universiade will open in 100 days. We welcome friends from all over the world to Sichuan. We will be waiting for you in the hometown of the panda. Thank you!

Chen Wenjun:

Thanks to Ms. Zheng Bei. I will give the floor to Mr. Wang Fengchao.

Wang Fengchao:

Ladies and gentlemen, and friends from the media, good morning! There are 100 days to go before the grand opening of the 31st FISU World University Games in Chengdu. This will be the first comprehensive international sports event held in western China. Since Chengdu won the bid to host the event, we have thoroughly acted upon General Secretary Xi Jinping's major expositions on sports and fully implemented the requirement of holding a "simple, safe, and splendid" event. In pursuit of excellence through constant improvement, we have spared no effort to push forward the preparation work and strived to present to the world a grand event for youth with unique charms and splendors.

First, we have made every effort to improve the facilities. We have been committed to the idea of whole-process organization of the games and promoted efficient and intensive use of resources and sustainable development. A total of 36 venues were reconstructed from existing venues, which will all be open to citizens when they are not occupied by matches. We will widely apply the environmentally-friendly, energy-efficient, smart, and intelligent technologies in catering, accommodation, transportation, training, and competitions and make an overall plan to manage the Universiade heritage so as to continue to deliver the comprehensive benefits of the games.

Second, we have comprehensively strengthened the organization of the games and ensured cultural exchanges. The general schedule and regulations concerning 18 major events and 269 minor events have been revised and issued. The selection and dispatch of technical committee chairs, and competition directors and managers have been completed. We are working on identifying gaps, improving weaknesses, and optimizing the organization of the games by means of table-top exercises and actual practices. We have made preparations for major events such as the opening and closing ceremony and the torch relay and will organize a city experience tour to visit the Jinsha Ruins site and the Dujiangyan irrigation system to create platforms for university students to enhance friendship and build bridges for mutual learning and exchanges between different cultures.

Third, we have upheld the principle of hosting the games, managing the city, and benefiting the people throughout the whole process. We have made extensive efforts to carry out cultural, sports, entertaining and sightseeing activities to present a dynamic and vibrant Chengdu, and advanced development of various areas and organic renovation and upgrading to improve the function, quality, and image of the city on all fronts. People have widely participated in public fitness programs, with 9.4 million people regularly exercising throughout the city. The Universiade has brought more vitality and meaning to Chengdu, "a park city at the foot of snow mountains and a prosperous city full of happiness."

Hello, friends from the media. Chengdu is one of the first national historical and cultural cities in China. It is an open, pluralistic city with vitality and vigor. It is constructing a park city demonstration zone that embodies the new development concept. At present, over 21 million citizens in Chengdu are enthusiastically anticipating this great event. We sincerely invite friends from all over the world to meet in Chengdu and make their dreams come true. They can enjoy the games, make friends, and personally experience the charm of the city. Whoever visits Chengdu will not want to leave and will want to come back again to visit. Thank you.

Chen Wenjun:

Thanks to Mr. Wang Fengchao. Now the floor is open for questions. Please identify your media outlet before raising your questions.

The Poster News APP:

The Universiade is a comprehensive world games second only to the Olympic Games in scale and is a sports event representing the highest level of competition among university students from around the world. How will the Chengdu Universiade promote the competition of athletic skills, exchanges, and interactions among the global youth?

Wang Jiayi:

Thank you to this reporter for your question. The mission of the Universiade is to improve the level of global university sport, promote exchanges and cooperation among university students of all countries, and enhance understanding and friendship. It is not only a sports stage for global youth to compete with each other in terms of athletic skills and improve their level of competition but also an educational platform for youth to communicate and interact with each other and broaden their international horizons. Given that the Chengdu Universiade arrives following three years defined by the COVID-19 pandemic, university students from around the world have stronger aspirations for such kind of exchanges.

The Chengdu Universiade will make full arrangements for carrying out global youth exchanges and interactions. Currently, we are formulating and improving a special plan for cultural exchanges. Based on the guiding principle of organizing diverse activities that are fashionable and cater to the taste of young people, provide them with enough cultural experience, and promote shared prosperity of all civilizations, we have come up with the arrangements for a series of activities to facilitate the exchanges of global university students in terms of sports, science and technology, culture, and innovation. During the Universiade, we will hold an art exhibition featuring the park city of Chengdu in the Universiade Village, as well as intangible cultural heritage exhibitions and experience activities, Chinese and international youth interaction activities themed on music, dance, and Sichuan Opera, and exchange activities, including getting close to watch giant pandas and visiting city museums to experience the culture of the city. Chengdu also has Sanxingdui Ruins site and Chengdu delicacies, which are quite popular among university students. All these can demonstrate the unique culture of the host country and host city and better promote in-depth exchanges and interactions among the global youth.

At the same time, as an important part of the events during the Universiade, the FISU World Conference and other academic exchange events will also be held. Themed "University Sports: Embracing a Colorful World," sports-centered academic exchange and discussion events will be organized in various forms, including oral reports on specific subjects, expert forums, round-table discussions, and group discussions. 

We will take the Universiade as an opportunity, and leverage the Universiade website as a platform to launch a column for young reporters. Focusing on topics of concern among contemporary university students, we will widely mobilize global university students to carry out exchanges and interaction and encourage them to contribute to the organization of the Universiade, the spread of diverse cultures, and friendly exchanges between China and other countries to jointly advance the building of a community with a shared future for global youth. Thank you.

CRNTT:

I have two questions. First, the 31st FISU World University Games is the first world-class multi-sport event to be held in western China. As a western province; does Sichuan meet the requirements for convenient arrivals of athletes and related staff? Second, how can hosting the Universiade further enhance the level of opening-up and cooperation?

Zheng Bei:

Thanks for your questions. They are of great significance. Since the 18th CPC National Congress, under the strong leadership of the Party Central Committee with Comrade Xi Jinping at its core, the CPC Sichuan Provincial Committee and the provincial government have committed to deepening opening up and cooperation and actively served and integrated this goal into the country's new pattern of development. Leveraging the Chengdu Universiade as an opportunity, we have accelerated the building of a comprehensive transport network and have been moving to the forefront of opening-up from an inland province. 

First, we have accelerated the construction of corridors for opening-up. With the opening of the Chengdu Tianfu International Airport, Chengdu has become the third city in the Chinese mainland to have two international airports, providing access to 131 international and regional air routes. In addition, Sichuan province now has 42 high-speed railways and expressways. The once-difficult road to Shu is now a thing of the past in Sichuan. The connected transportation has been fully realized, and we are striving to advance building a smooth transportation network. We have also opened green channels for the Chengdu Universiade to ensure athletes and friends from around the world can arrive and depart quickly and conveniently. 

Second, we have enhanced international exchanges and cooperation. There are 23 approved consular organizations established in Sichuan province. Chengdu now boasts the third-most consulates after Shanghai and Guangzhou. It has established economic and trade ties with over 220 countries and regions. There are more than 5,300 foreign companies in Sichuan province, 337 of which are among the world's top 500. The circle of friends with whom Sichuan can communicate and cooperate has continued to grow. 

Third, we have created new strengths for opening-up. Seizing the opportunities presented by the convergence and superposition of national strategies in Sichuan, including the Belt and Road initiative, the development of new land-sea transit routes for the western region, and the development of the Chengdu-Chongqing economic zone, we have vigorously promoted opening-up to the west and south. The number of China-Europe freight trains from Chengdu and Chongqing has accounted for more than 30% of the country's total. The number of rail-sea intermodal trains from Sichuan to the Beibu Gulf Port in south China's Guangxi Zhuang Autonomous Region has increased by more than 30% for two consecutive years. We will take the Chengdu Universiade as an opportunity to enhance exchanges and cooperation with other countries in the world and share development opportunities with them to pursue opening-up and cooperation on a larger scale, in broader areas, and at a deeper level. Thank you. 

21st Century Business Herald:

The Chengdu Universiade is the first major international event to take place after China adjusted its COVID-19 response measures. Tens of thousands of athletes and spectators from various countries and regions are expected to gather in Chengdu. What facilitation arrangements will be provided to them? How can tickets be purchased for the games? What advice do you have for watching the games? Thank you. 

Wang Fengchao:

Thank you for your questions. In order to ensure a smooth and enjoyable experience for everyone involved, the organizing committee has meticulously organized and prepared the following the open approach. All events in the venues that have suitable watching conditions will be fully open for ticket sales, allowing the public to watch the event on site. 

Based on ticket operation plans and communication and coordination with the FISU, we plan to fully launch ticket sales in early June. Related ticketing information will be published on the games' official channels. Close attention from the public and the media are welcome. 

For on-site viewing, we will set up audience service information desks, baby stroller storage areas, wheelchair rental services, medical care stations, nursing rooms, accessible entrances, and restrooms to effectively meet the various needs of the audience. Meanwhile, a bilingual guide for watching events in both Chinese and English will be provided. The section on "About Chengdu Universiade Tickets" introduces ticket knowledge, holder instructions, and common ticketing problems; the "Must-Read for Audience" section highlights transportation services, venue facilities, services, special tips, and rules for viewing events; the "How to Get to the Venues" section emphasizes the venue index, Universiade venues, and the supporting facilities around the venues, and the "Experience Chengdu Culture" section focuses on Chengdu's scenic spots and attractions rated 4A or above, famous cultural sites and museums, and new urban economic development landmarks. All these aim to bring audiences a safe, efficient, convenient, and comfortable viewing experience. Thank you.  

Science and Technology Daily:

The Chengdu Universiade is the first university games supported by 5G technology. We know that a satellite called Dayun was sent into space last year. Can you brief us on other smart elements and high-tech means related to the Universiade? How will they make the preparation for the games smarter and make the games fairer and more just? Thank you. 

Wang Fengchao:

Thank you for your questions. Taking the Universiade venues as an example, there are three venues at Dong'an Lake Sports Park, including a multi-purpose gymnasium, an aquatics center, and a comprehensive ball games gymnasium. The "BIM technology + smart construction site" cockpit system was adopted throughout their construction in order to realize the smart construction of these large-scale venues, resulting in intensive and compact space structure, improved efficiency, and reduced energy. The multifunctional use of venues has been realized, which means that we can convert an ice hockey rink to a basketball court in 4 to 6 hours. Fenghuangshan Sports Park has been equipped with an intelligent navigation system and an intelligent security assistance service system to provide indoor positioning navigation, real-time positioning guidance navigation, and one-click rescue services.

At the same time, we will install smart robots at key venues, such as the special waiter Rongbao, named after the Games' mascot, which is the first robot in the world to feature emergency handling functions. It's equipped with a first-aid kit, defibrillator, and other medical tools and offers services like face identification, temperature measurement, and multi-language translation. 

We also developed an app entitled "Chengdu FISU Games" to offer three kinds of services, namely, competition participation, competition watching, and life services. The competition participation sector can provide a VR guide to the Universiade Village, realize activity appointments, and publish catering, transportation, and weather information. The competition watching sector includes the history of the Universiade as well as an introduction to competition items and the schedule, ticket purchases, competition schedule and results consultation, and live broadcasts of key events. The life service sector includes an online tour of Chengdu city, financial services, online shopping, and departure tax refund services. Thank you.

CCTV:

What's the current progress of the formation of China's delegation? What can we expect regarding the competition's results? Thank you.

Wang Jiayi:

Thank you for your question. This is a question of common concern among college students.

China has always placed great emphasis on exchanges and cooperation with the FISU and has actively taken part in various competitions it has held around the world. As the host country of this session of the Universiade, we have received a lot of attention and high expectations. Under the support of the General Administration of Sport, the formation of the delegation has made smooth progress. I will share with you in three aspects:

First, we will strive to take part in all the competition items. The Chengdu Universiade features 18 sports, all of which we will attend. In addition, we will try to participate in all the events. Currently, there are over 800 delegates, among whom there are some 500 athletes.

Second, the athlete selection is well underway. Following the principle of openness, fairness, and impartiality, we select competitors via competitions and take into account character, willpower, and overall strength.

Third, preparations are proceeding at full steam. Intensified training will be organized in a planned way, targeting 18 sports so as to fulfill high-level preparations and achieve great results during the competition. At the same time, we will conduct zero-tolerance anti-doping work. As China is the host country, we should perform well and in a clean manner.

One thing that I should point out is that the Chengdu Universiade is not only a stage for sports competitions but also a communication platform and an opportunity to showcase the comprehensive quality and spirit among Chinese college students. The Chinese delegation will enhance competition and communication with athletes from other countries at the stadium. We expect to realize a harvest of both competition results and morality and showcase an appealing, amiable, and respectable Chinese image. Thank you.

Zhejiang Daily:

Anti-doping is an important part of holding top-level international competitions. Could you please brief us on the anti-doping work of the Chengdu Universiade?

Zhou Jinqiang:

The Organising Committee of the Chengdu 2021 FISU World University Games has placed great emphasis on anti-doping work, made testing plans in accordance with technical standards and requirements of the FISU. With accreditation from the World Anti-Doping Agency, the testing will be conducted by a Beijing anti-doping laboratory . By now, the work plans of the control guidelines, publicity, and education, as well as sample transfers, have been formulated. The doping test, anti-doping education, and risk control of food-borne doping are all well underway. The FISU has expressed satisfaction and given a good appraisal of our country's capacity and experience of anti-doping work in comprehensive sports events. 

Here are some specific highlights.

First, regarding doping testing, the Chengdu Universiade will conduct doping tests throughout all sports categories. By now, we have completed three rounds of doping control station acceptance tests, which have all met the requirements. During the competition, we will dispatch 78 doping control inspectors to conduct the work. The Chengdu Universiade has introduced some trials on doping tests. It will conduct paperless tests through the China Doping Intelligent Management Platform following the frugality principle; it will, for the first time in the history of the Universiade, conduct dried blood spot tests through advanced scientific techniques and stringent procedure control measures to create a fair and clean competition environment for athletes.

Second, so as to promote anti-doping education, the Chengdu Universiade will establish anti-doping education stations at the Universiade Village to provide Q&A sessions, video studies, and cultural demonstrations to guide athletes, trainers, and service team members to proactively increase their anti-doping knowledge and awareness. At the same time, we will also create a clean, pure, and positive atmosphere during intense competitions through the stations and related education and publicity activities.

Third, concerning the prevention and control of foodborne doping risks, the organizing committee adheres to the principle of "prioritizing prevention, risk management and controlling processes." The committee will strictly implement food safety requirements for large-scale sports events, strengthen oversight over the entire food chain, strictly control the processes, and eliminate food safety and foodborne doping incidents. This approach will ensure the cleanliness and purity of the Universiade. Thank you.

CETV:

Major international events cannot be held without the efforts of volunteers. The public is paying close attention to the recruitment of volunteers for Chengdu Universiade. How is the recruitment of volunteers progressing, including the number and proportion of college students involved and the scope of schools participating? What special training programs have been arranged for the event's needs? Thank you.

Wang Fengchao:

Thanks for your questions. The Universiade has recruited more than 20,000 volunteers, including professional volunteers providing services in areas such as language, competitions, award ceremonies, and flag-raising ceremonies. Recruitment was completed in March, and the volunteers are from 34 different universities.

They are currently undergoing general knowledge training, including 60 courses such as foreign affairs, international etiquette, oral communication skills, and civilized etiquette. The training is mainly conducted online, including testing. Volunteers who pass the tests will undergo an eight-day offline intensive training program to further improve their abilities. They will provide services in a series of test events in May and June and those who meet the requirements will thereafter begin their work. 

During the recently concluded Heads of Delegation Meeting (HoD Meeting), over 200 volunteers from 10 universities in Chengdu impressed the FISU officials and delegation members with their warm service, friendly attitude, professionalism, and fluency in multiple languages.

At the same time, we have launched the "Partnership Plan" for urban volunteer services, striving to create a strong atmosphere where "everyone is a volunteer." Over 1 million urban volunteers are expected to participate in publicizing the host city and the sports events, and providing other volunteer services. Volunteers of Chengdu Universiade are affectionately nicknamed "little green peppers." As the "image spokesperson" of the city, these volunteers will present Chengdu to the world with warm-hearted and thoughtful services, spreading the Tianfu culture that boasts amity and charity. Thank you.

Cover News:

Sports are an important way for young people to grow up healthily and improve their overall quality of life. How will Sichuan province use the Universiade as an opportunity to promote the healthy development of young people and sports in the province? Thank you.

Zheng Bei: 

This is a very good question. The upcoming 31st FISU World University Games will be the first large-scale international sports event to be held in western China. Perhaps most importantly, it presents a significant opportunity to encourage Sichuan youth to participate in sports and promote their all-round and healthy growth. With this objective in mind, we have prioritized the following tasks:

First, we have actively created a strong sports atmosphere. We have extensively organized a series of sports activities such as basketball, volleyball, table tennis and sports exchange activities among the youth in Sichuan province and Chongqing municipality, aiming to create a unique event IP so that more young people can enjoy the fun of physical exercise, improve their health and exercise their willpower. We have also organized college volunteers to travel to different parts of the province to conduct sports training activities and encourage more young people to love sports. This is an important task we have undertaken.

Second, we have comprehensively deepened the integration of sports and education. We have organized professional athletes to participate in sports classes in various schools, encouraged more outstanding retired athletes to serve as school sports coaches, and promote Universiade sports on campuses to enhance young people's enthusiasm for participating in sports. The "Gongga Cup" Youth Campus Sports League has been held in our province for three consecutive years. We aim to promote "frequent training" through "regular competition," which will enhance students' interest in improving their sports skills.

Third, we have steadily moved forward with opening the venues of the Universiade to the public and have taken actions to benefit the people. Just now, Mr. Wang said in his introduction that the venues and facilities of the Universiade have been open to the public for free or at a low cost. By doing so, we have brought more campus-based sporting events, PE classes, and daily training to these venues, enabling young people to appreciate the charm of Universiade culture and inspiring their vitality and enthusiasm for sports. Thank you. 

Hong Kong Bauhinia Magazine:

The post-game operations, maintenance, and utilization of large sports venues is a world-level challenge for event organizers. Will these venues later be open to citizens? The Universiade has improved national fitness. How will Chengdu increase people's sense of fulfillment and happiness by hosting the Games? Thank you.

Wang Fengchao:

Thank you for your questions. Since the beginning of preparation, we have stayed committed to the vision that the Chengdu Universiade will be inclusive and a benefit to the people. We have comprehensively implemented public-interest initiatives in terms of venue utilization, sports promotion, cultural activities, and environmental improvement to make the Universiade "a project of the heart" that improve people's well-being.

In terms of venue utilization, we have taken measures to ensure that all qualified venues will be open to the public and undertake sporting events. The list of venues with tailored policy support has been dynamically updated to benefit the people, and various experience-based day activities, such as Fitness Day and Sharing Day, have been held there. In 2022, the venues were open to the public for nearly 80,000 hours free of charge or at a low price. More than 5.09 million people visited these venues, and 727 sporting events were held there. All these have promoted extensive public fitness activities in Chengdu. 

In terms of sports promotion, we have changed spare spaces in urban parks and communities into high-quality sporting spaces to increase urban vitality. We have also built neighborhood fitness facilities and communities that feature various sports, finished training of over 1,000 community fitness instructors, and held more than 6,400 events, including community sports festivals, to let more citizens enjoy fitness and happiness brought by sports.

In terms of cultural activities, we have planned and launched various public events and cultural exchange events to ensure all citizens can participate in and enjoy the Universiade. We have held music weeks and art exhibitions and carried out more than 5,000 Universiade-themed exhibitions, performances, and publicity events in communities and campuses. Amid a campaign to build role models for nationally civilized cities, Chengdu has encouraged its citizens to study foreign languages and etiquette. Under such circumstances, we have promoted an app called "U-translate" to help facilitate citizen's communication with the world.

In terms of environmental improvement, we have given prominence to the nature of Chengdu as a "park city" and have been prepared to host a green and low-carbon Games. We have added a special zone called "Low-carbon Universiade" to the Tanhuitianfu app and encouraged market entities and citizens to contribute to the achievement of carbon neutrality targets during the Games. We have also improved the sports and leisure facilities in Chengdu's municipal parks and enhanced the service capacity of the Dong'an Lake Sports Park. Camping in parks and watching the sunrise on the top of Longquan Mountain have already become new leisure trends in Chengdu.

We sincerely welcome friends from around the world to visit Chengdu, where a strong atmosphere of fitness and fashion has been formed. Together with Chengdu residents, they will enjoy a healthy and happy life brought about by the World University Games. Thank you.

Chen Wenjun:

The last question.

Red Star News:

A successful sporting event will help promote the vision and spirit of the sports. What are the visions laid out by the organizers of the Chengdu Universiade? What are your considerations for improving national fitness by hosting the Universiade and integrating sports with city development? Thank you.

Wang Fengchao:

Thank you for your questions. The organizers of the Chengdu Universiade have followed a principle of presenting a streamlined, safe, and splendid Games, which is demonstrated throughout the whole preparation process. While focusing on the Universiade's preparation, we have strengthened national fitness campaigns through various activities. We have launched an action to "Meet the Most Beautiful Sport," introduced several themed routes for outdoor recreational sports, created 100 sports consumption demonstration scenarios, and provided free or low-price tickets and 10,000 sports coupons for the public's benefit. By doing so, we have encouraged citizens to visit urban parks and the Tianfu Greenway, inspired their enthusiasm for national fitness campaigns, and fostered an atmosphere of leisure and sports in the city. When the Universiade come to Chengdu, its sport spirit will integrate into the city's Tianfu culture, which features amiability, optimism, openness, and inclusiveness, and together they will forge the city's spirit of greater strength and resilience. Thank you.

Chen Wenjun:

Thank you to all the speakers and friends from the media. Today's press conference concludes here. Goodbye.

Translated and edited by Zhang Rui, Wang Wei, Guo Yiming, Ma Yujia, Xu Kailin, Liu Sitong, Yang Xi, Li Huiru, Mi Xingang, Yuan Fang, Xiang Bin, Huang Shan, Li Xiao, David Ball, Tom Arnsten, and Jay Birbeck. In case of any discrepancy between the English and Chinese texts, the Chinese version is deemed to prevail.

Read in Chinese

Speakers:

Mr. Luo Wen, minister of the State Administration for Market Regulation (SAMR)

Ms. Gan Lin, vice minister of the SAMR

Mr. Tian Shihong, vice minister of the SAMR

Mr. Pu Chun, vice minister of the SAMR

Chairperson:

Ms. Shou Xiaoli, deputy director general of the Press Bureau of the State Council Information Office (SCIO) and spokesperson of the SCIO

Date:

April 13, 2023

Shou Xiaoli:

Ladies and gentlemen, good afternoon. Welcome to this press conference held by the State Council Information Office (SCIO). This is the 14th briefing in the series "Embarking on the New Journey — A Government Perspective." Today, we have invited Mr. Luo Wen, minister of the State Administration for Market Regulation (SAMR), to brief you on energizing the market and solidifying the foundation for high-quality development, and to take your questions. Also joining us today are three vice ministers of the SAMR: Ms. Gan Lin, Mr. Tian Shihong and Mr. Pu Chun.

Now, I'll give the floor to Mr. Luo for a brief introduction.

Luo Wen:

Friends from the media, good afternoon. To begin with, I'd like to thank you for your long-standing interest in, support and help for the market regulation work. It is also my pleasure to have the opportunity to speak with you today and brief you all on market regulators' ideas, measures and progress concerning implementation of major decisions made by the 20th National Congress of the Communist Party of China (CPC).

At the 20th CPC National Congress, General Secretary Xi Jinping stressed that high-quality development is the primary task for building a modern socialist country in all respects, and called for efforts to expedite the establishment of a new development pattern and promote high-quality development. Practical efforts over the years have taught us that high-quality socioeconomic development would not have been possible without hundreds of millions of vibrant and resilient businesses. Since the 18th CPC National Congress, the Chinese market has seen a significant expansion in size, a continued optimization in structure, and a gradual improvement in environment. Various thriving businesses have provided a strong support for stable economic growth and comprehensive elevation of the nation's overall strength.

This year marks the start of fully implementing the guiding principles of the 20th CPC National Congress, and it is particularly important to ramp up efforts on the economic side. Market regulators will resolutely implement the decisions and plans made by the CPC Central Committee and the State Council. We will give full play to our close connections with both the market and businesses, further optimize our regulatory ideas, improve institutional arrangements, develop new measures, and make greater efforts to energize all market entities, in a bid to consolidate the foundation for effectively upgrading the quality of the country's economy and achieving reasonable growth.

First, we will energize market entities by deepening reform. We will improve the market entry and exit system and establish a set of regulatory rules that are unified, standardized, impartial and transparent. We will further reduce government-imposed transaction costs for market entities, and provide greater convenience for business production and operation. In addition, we will keep optimizing regulatory measures, improve the effectiveness of regulation, and make ongoing and ex post regulation more precise and scientific using methods such as credit rating-based regulation and smart regulation.

Second, we will further spur market vitality by pursuing fair competition. Protecting and promoting fair competition and creating an inclusive and fair market environment is conducive to giving full play to businesses' initiative and creativity, and continuously boosting their growth momentum and innovation vitality. Market regulators have always laid equal emphasis on regulating their own work and promoting development, so as to become a builder of a fair competition system, a protector of a fair competition market, a defender of consumers' interests, and a guardian of a unified domestic market. Market regulators will investigate and deal with various cases of monopoly and unfair competition in accordance with the law, fully implement an examination system for fair competition, and provide enormous market space for all sorts of businesses to thrive.

Third, we will implement law-based governance to revitalize the market. The rule of law should play a more important role in consolidating the foundations of governance, meeting people's expectations, and maintaining long-term development. Market supervision authorities need to further apply law-based thinking and approaches to ensure that their work is carried out in line with the rule of law and constantly improve the stability of market supervision and stabilize enterprises' expectations. To boost market confidence, we will ensure continuity and consistency in law enforcement that is fair and equitable. We will also balance the principles of "law, reason, and emotion," improve the effectiveness and efficiency of our work, and ensure that our law enforcement is both firm and compassionate.

Fourth, we will provide greater support and assistance to enterprises and small business owners, recognizing their crucial role as the mainstay of the market economy and the driving force behind its vitality. Market supervision authorities will intensify efforts to improve and implement measures that will help enterprises overcome challenges and obstacles. We will step up targeted cultivation and precise assistance, implementing initiatives aimed at enhancing high-quality development and boosting competitiveness. Additionally, we will crack down on illegal fee collection to ease the burden on enterprises.

Fifth, we will promote order and vitality through regulation. Creating a favorable "soft environment" to stimulate market vitality will be impossible without "hard measures" to regulate market order. Market supervision authorities will take resolute actions and not be lenient toward behaviors that violate market rules and disrupt market order, such as price fraud, infringement, counterfeiting, and false advertising. In particular, for key areas directly related to people's health and safety, such as food, drugs, industrial products, and special equipment, we will always stick to strict law enforcement, strengthen regulation, and severely punish illegal behaviors to promote a healthy market order and unleash market vitality.

This concludes my introduction. Next, my colleagues and I are happy to answer your questions. Thank you.

Shou Xiaoli:

Thank you, Mr. Luo, for your introduction. The floor is now open to questions. Please identify the news outlet you represent before raising questions.

Southern Metropolis Daily:

Self-employed individuals, represented by street vendors, play a vital role in China's economic development and are essential to the country's economic recovery. What specific measures will be taken this year to promote the growth of these businesses? Thank you.

Luo Wen:

Thank you for your question. Self-employed individuals play a crucial role in China's socialist market economy, serving as important components of the industrial, supply, and consumption chains while also functioning as vital components in the market. They are the direct providers of services in people's daily lives. Since the 18th National Congress of the Communist Party of China, self-employed businesses have experienced significant growth due to the encouragement, support, and guidance of the Party and the government. The total number of self-employed businesses has increased from over 40 million in 2013 to 116 million today. They have played a key role in creating jobs, stabilizing employment, improving people's lives, and promoting market vitality.

We must also acknowledge that individual and family-based businesses are generally small in scale and lack the ability to withstand risks when competing in the market. Given the challenges posed by the economic downturn and the COVID-19 pandemic, these businesses continue to face numerous difficulties and require our special protection and care. Going forward, in accordance with the guiding principles of the 20th CPC National Congress, the SAMR will provide stronger assistance and support to ensure the healthy development of these businesses.

First, we will fully implement the guidelines for promoting the development of self-employed businesses. We will leverage the inter-departmental joint meeting mechanism and work together with relevant departments to actively research and formulate support policies in social security, taxes, and fees. We will also continue to organize events such as the "National Month of Service for Individual Business Owners" to provide strong and helpful support for their development.

Second, we will implement pilot projects according to self-employed individuals' types and categories. We will focus on three different types of self-employed individuals: subsistence-based, growth-focused and development-oriented types, as well as four different categories, including local specialties, high-quality new products, and those associated with famous brands. We will provide targeted cultivation and support and help them in a scientific and targeted manner. Meanwhile, we will also strengthen investigation, research, monitoring, and analysis to continuously improve our service standards.

Third, we will give full play to service platforms for self-employed individuals. We will adhere to the government's guidance, allow the market to play its part, and share the benefits with all of society. By integrating resources from all aspects, we will offer information services such as entrepreneurship training, recruitment and employment, laws and policies to self-employed individuals. We will assist more self-employed individuals in understanding policies and reaping greater benefits, supporting them to better leverage their advantages and integrate into the market.

Fourth, we will focus on Party building efforts for micro and small enterprises, self-employed individuals, and professional markets. We will explore and strengthen Party building within new business forms and employment groups, integrating Party building work into the whole process of supervision and services. In particular, we will advance the establishment of Party building work guidance stations under market regulation offices, ensuring that all required stations are built. Through such efforts, we will promote the high-quality development of self-employed individuals with high-quality Party building. Thank you.

Zhonghongwang.com:

High standards are an important indicator of a country's high-quality development and its participation in high-quality competition. What role does China's standardization work play in the process of promoting high-quality development? What are your plans for the next steps? Thanks.

Luo Wen:

Thank you for your important questions. Competition among enterprises involves not only products but also standards, which hold even higher importance. I would like to invite Mr. Tian to answer your questions.

Tian Shihong:

As a crucial element of a fundamental system, standards, along with measurement, certification, recognition, inspection and testing, make up a nation's quality infrastructure. As such, they also serve as an essential technical force to support high-quality development.

General Secretary Xi Jinping pointed out that standards determine quality, and high quality can only be achieved with high standards. Standardization plays a foundational and leading role in promoting the national governance system and the modernization of governance ability. The CPC Central Committee and the State Council have attached high importance to standardization-related work and specifically issued an outline to promote standardized development at the national level, forming a comprehensive plan for the medium- and long-term development of our standardization. The SAMR has consistently treated standardization-related work as a key task for promoting high-quality growth. We have actively collaborated with relevant departments and local authorities to continuously improve standardization management systems and mechanisms that are unified, authoritative and highly effective. We have also accelerated the building of a system of standards that is structurally optimized, advanced, reasonable, and compatible with international rules, providing support to high technology innovation, high-level opening-up and high-quality development. We have mainly carried out our work in the following aspects.

First, we have strengthened the top-level design of the standards system. The Standardization Administration, along with 15 other departments, has released an action plan for implementing the outline to promote standardized development at the national level. We have advanced the implementation of various major projects, including those focused on high-end equipment manufacturing standardization to strengthen China's infrastructure, leading projects for new industry standardization, initiatives for upgrading carbon peaking and neutrality standardization, and projects aimed at advancing standardization to align with global standards. We have also issued a series of documents on guiding standardization-related work in green development, digital villages, intelligent manufacturing and other fields, providing policy support for building and promoting the system of standards for high-quality development.

Second, we have accelerated our efforts to improve the supply structure of standards. We have promoted a shift from government-led supply standards to a balanced emphasis on both government and market-driven supplies. We have adhered to the fact that standards are set for public welfare and thus strengthened the government's guidance and management. At the same time, we have also encouraged enterprises and society to actively participate in setting standards, leaving development room for the market to formulate standards independently. So far, China has issued 43,000 national-level standards, 78,000 registered industrial standards, 62,000 local standards, 53,000 open self-declaration group standards, and over 2.7 million enterprise standards. Among these, more than 3,200 are leading enterprise standards with first-class technologies, advanced management and remarkable benefits. Thanks to such efforts, we have essentially established a standardization work pattern that is market-driven, government-guided, participated in by society, enterprise-centered, and characterized by openness and integration.

Third, we have accelerated standardization in all sectors. We have taken extensive action to implement the "Standardization Plus" program. As a result, nearly 10,000 agricultural standards have been set, and standardized production accounts for over 30% of agricultural production. Industrial standards have also been constantly upgraded. The international standard conversion rate in many fields, including key equipment manufacturing and next-generation information technology, now exceeds 90%. The consistency of standards on major consumer goods with international standards has reached 95%. The service sector's standards system has improved steadily, with newly released national standards on this sector increasing by 12% year on year. We have also effectively standardized social development in 37 key areas, including administrative management, basic public services, public security, social governance, and other social programs. Standardization is playing an increasingly prominent role in promoting industries' transformation and upgrading, meeting people's desire for a better life, and serving China's opening-up.

Fourth, we have consolidated the foundation for the development of standardization. We have strengthened the entire life cycle management of various standards. Scientific research capacities and management systems for standardization have been steadily improved. We have vigorously advanced the standardization of basic research and application services. Currently, there are more than 1,300 national professional technical organizations for standardization in China, with over 50,000 domestically registered experts and 12,000 experts registered to international organizations. More than 7,300 national pilot demonstration programs for standardization have been established, and nearly 30 national technical standard innovation centers have been built, greatly boosting our basic capacity to support standardization.

Next, the SAMR will fully study and implement the guiding principles of the 20th CPC National Congress and focus our efforts on key targets and tasks to build China into a manufacturer of quality. We will fully implement the outline to promote standardized development at the national level and the outline to improve the overall quality of China's economy. We will strive to change from a pattern in which the government leads the standards-making process to a pattern in which both the government and market contribute to the standards-making process, from a pattern in which standards are mainly applied in industry and trade sectors to a pattern in which standards are applied in all economic and social sectors, and from a pattern in which standardization work is conducted domestically to a pattern in which standardization work is conducted through international cooperation. In addition, standardized development will transform from a quantity-and-scale model to that of quality and efficiency. By doing so, we will work faster to create a system of standards for promoting high-quality development and serve high-quality economic and social development with standardization work. Thank you.

Kyodo News:

In 2021, the SAMR imposed an administrative penalty on Alibaba Group according to China's anti-monopoly law for the company's abusing its dominant position in the country's online platform market. What's the current situation of China's anti-monopoly work in the online platform market? Thank you.

Luo Wen:

Thank you for your question. Recently it has been a question of common concern. Ms. Gan Lin will answer your question.

Gan Lin:

Thank you for your interest regarding China's anti-monopoly work. Just now, Mr. Luo Wen stressed in his remarks that we have always laid equal emphasis on regulating supervision and promoting development. Also, we have continued to optimize the order of market competition through law enforcement in the field of the platform economy, and further stimulated the innovation vitality and development momentum of platform enterprises and small- and medium-sized enterprises on these platforms.

Let me illustrate this for you. Our law enforcement methods consist of tiered supervisory measures, which include not only administrative penalties but also cautionary talks, administrative guidance, and regulatory guidance. These measures combine to form our regular anti-monopoly supervision. By comprehensively applying these measures according to specific problems, the level of competition within the platform economy has been enhanced. Our work mainly focuses on the following three aspects.

First, we have optimized regulations and rules. We have revised the Anti-Monopoly Law, introduced the Law Enforcement Rules and Regulations for Anti-monopoly Supervision over Internet Platforms, and amended supporting regulations such as the Regulations on Prohibiting Monopolistic Agreements and the Regulations on Prohibiting Abuse of Dominant Market Positions. By specifying provisions on the anti-monopoly supervision of internet platforms, the rules and regulations provide clearer and more definitive guidelines for business entities. 

Second, we have strengthened compliant competition guidance. Besides investigating and punishing all forms of monopoly in accordance with the law, we have also urged platform enterprises to completely end monopolistic practices such as requiring businesses to pick sides, to earnestly implement rectification measures, and to improve compliance. Meanwhile, we have given full play to the warning and demonstration effects of typical cases to improve competition order in the market.

Third, we have constantly strengthened regular supervision. We have proposed to enhance the effectiveness of supervision throughout the entire process, from before, during, and after the event, with a full-chain approach. We have strengthened the assessment, monitoring and warning over market competition and optimized preventative supervisory measures to effectively prevent and defuse monopoly risks among internet platforms. This approach ensures fair competition and provides a favorable environment for the well-regulated, sound and sustainable development of platform enterprises. Thank you. 

CCTV:

The CPC Central Committee and the State Council recently issued an outline to improve the overall quality of China's economy, which provides a guide to action on coordinating efforts in this regard. What's the SAMR's plan to implement the outline this year? Thank you.

Luo Wen:

Thanks for your question. Quality is an important guarantee for human production and life. Boosting the overall quality of the country's economy is a critical pathway to better meet people's desire for a better life and improve their well-being. Since the 18th CPC National Congress, the Chinese people's awareness of quality has increased significantly, the overall quality of products and services has improved steadily, and quality safety has been continuously optimized. The outline issued by the CPC Central Committee and the State Council provides a guide to action on boosting the overall quality of China's economy. This year, we will make efforts to implement the outline mainly in the following three areas.

First, we will consolidate one foundation, which refers to quality infrastructure, encompassing measurement, standards, certification and accreditation, inspection and testing, and other sectors. Quality infrastructure is the fundamental support for boosting the overall quality of China's economy. We will accelerate the building of a modern, advanced measurement system, improve the supply structure of government and market standards, optimize the quality certification system, and increase the capability of comprehensive inspection and testing. We will build a batch of national quality standard laboratories and promote one-stop national quality infrastructure services to make our service more efficient.

Second, we will carry out two campaigns, which refer to quality-improving campaigns both in the product and service sectors. In terms of product quality, we will focus on key categories like food and drugs, as well as key groups, including the elderly, students, children, and people with disabilities. We will conduct regulations covering all groups, all categories and all stages to improve quality safety. In terms of service quality, we will strengthen quality supervision of life-related services and target prominent problems from one industry to another to enhance the consumption experience and guarantee a high-quality life for people.

The third is to launch "three projects." Regarding regions, we will launch a demonstration project on regional quality development, explore the building of role model cities that contribute to boosting China's strength in manufacturing, and develop a demonstration zone for quality brand promotion. Regarding industries, we will launch a project to improve the quality of the industrial chain and jointly advance breakthroughs in quality-related generic technologies. We will accelerate the quality upgrading of the industrial system, steer the industrial chain toward the medium- and high-end, and strengthen industrial competitiveness. Regarding enterprises, we will launch a project to develop Chinese brands and improve the mechanism to foster and grow brands. We will conduct evaluations for the fifth China Quality Award and honor its winners to help develop more quality Chinese products and time-honored brands. Thank you. 

Red Star News:

The report to the 20th CPC National Congress made arrangements for the social credit system as one of the systems underpinning the market economy. What achievements have been made in establishing the credit system and strengthening credit oversight in recent years? Thank you. 

Luo Wen: 

Thanks for your question. We know that credit is a pass in the market economy and plays an essential role in improving the market economy system. I will invite Mr. Pu to answer this question. 

Pu Chun:

General Secretary Xi Jinping pointed out that the socialist market economy is a credit economy. Since the 18th CPC National Congress, the market regulation authorities have firmly implemented the decisions and arrangements of the CPC Central Committee and the State Council and established and improved the new-type oversight mechanism, which is centered on the random selection of both inspectors and inspection targets and the prompt release of results, supplemented by oversight of major areas, and based on oversight of credibility . This has reshaped the daily supervision process and realized targeted supervision of enterprises. The oversight efficiency has been constantly improved through coordinated promotion, strongly serving high-quality socio-economic development.

First, a credit information collection and sharing system has been established. A national enterprise credit information disclosure system has been created to legally collect and make public the information of all registered business entities, including their registration, annual reports, administrative licenses, administrative penalties, and random inspections. This has made corporate information more transparent, which is conducive to addressing information asymmetry issues and helps reduce market transaction costs. In addition, the disclosure system has also played a role in encouraging social oversight and guiding society-wide co-governance. Since its launch, the system has collected 5.47 billion pieces of enterprise information, attracting a total of 300 billion visits, with the daily visits exceeding 100 million, and has achieved good social results.

Second, credit constraints and penalties on acts of bad faith have been applied. A management system for abnormal operation list and list of serious legal violations and acts of bad faith has been established and joint punitive actions against bad faith have been conducted so that one dishonest behavior of both individuals and enterprises will result in restrictions at every turn. Meanwhile, the mechanism for protecting the rights and interests of for business entities has been improved, good credit has been restored for some who were once dishonest, and self-correction to reshape the credit has been encouraged. As of the end of February this year, a total of 436,000 pieces of information on administrative penalties were stopped from being made public in advance, 2.87 million records of abnormal operations have been removed from the abnormal operation list, and 9.847 million self-employed individuals have been restored to normal records.

Third, random inspections and supervision have been fully advanced. The random selection of both inspectors and inspection targets and the prompt release of results have realized full coverage on a regular basis, replacing the original inspection system and arbitrary checks involved in daily supervision. The establishment of a supervision system featuring clearly defined rights and obligations, equity and justice, and precision and high efficiency has been accelerated. The supervision actions have been further standardized, and methods have been innovated. Random joint interdepartmental inspections have been actively carried out, checking multiple items during a single inspection. This has not only reduced undue interference from government departments on the independent operation of enterprises but also improved supervision efficiency, saved resources, and cut costs.

Fourth, credit risk classification management has been implemented. Differentiated supervision measures have been adopted according to the credit statuses of business entities. For those with good credit and lower risk, the proportion and frequency of inspections have been reasonably set. For those who have violated the law or have high risks, we have intensified random inspections and enforced strict regulatory measures in accordance with laws and regulations, making the supervision more targeted and precise. As a result, we have not disturbed the honest who abide by the law, yet maintained rigorous warning and deterrence for the dishonest who violate the law and breach trust.

Fifth, we have strengthened credit supervision in key areas. In key sectors such as food, medicine, essential industrial products, and special equipment that affect public safety and the safety of people's lives and property, we have intensified efforts to disclose credit information, restrict dishonest behaviors, and jointly implement punishments. We have accurately identified and rigorously combated illegal and dishonest behaviors, effectively preventing and mitigating risks while ensuring safety measures are in place. Thank you.

The Beijing News:

Maintaining price stability is essential for boosting consumer confidence. In recent years, issues related to prices have attracted a lot of attention. What measures have been implemented to maintain price stability? Thank you!

Luo Wen: 

Thank you. The issue of price is always a concern for the entire society. This question goes to Ms. Gan.

Gan Lin:

Thank you for your question. Price acts as the “barometer” of the market economy and plays a vital role in all aspects of economic activity. It is closely related to every consumer.

As you may be aware, since last year, inflation rates in major economies worldwide have repeatedly hit new highs. Despite this situation, China has maintained generally stable prices, which is a significant achievement. In its efforts to maintain price stability, the SAMR has concentrated on its core functions and undertaken the following initiatives:

First, in terms of epidemic-related materials, we have strengthened supervision efforts to effectively respond to the rapid rise in prices of epidemic-related drugs, protective equipment and medical supplies. Since the outbreak of the pandemic, the price of epidemic-related materials has been a focus of concern for the CPC Central Committee, the State Council, and the general public. In particular, from the end of last year to the beginning of this year, some unscrupulous operators hoarded and even sold epidemic-related drugs and medical supplies at inflated prices. To address this issue, the SAMR quickly took action and issued a “Reminder and Warning Letter on Prices and Competitive Order of Epidemic-related Materials,” which clarified the “Nine Prohibitions” requirement. In addition, a nationwide special campaign was launched to stabilize prices and ensure the quality of epidemic-related drugs and medical supplies. This campaign has been ongoing for half a year and is still in progress. As of now, 6,253 cases have been filed nationwide, with a penalty amount of 39.39 million yuan. These efforts have effectively maintained price stability in epidemic-related drugs and medical supply markets across the country.

Second, we have implemented targeted measures for major commodity categories and critical links to promote stable and healthy socio-economic development. Commodity prices are prone to be heavily impacted by the international markets and have a notable transmission effect. The SAMR has focused on three key areas: key types of commodities, critical periods and major links. We have also continued to intensify our supervision and law enforcement efforts. To address issues related to electricity supply caused by rising coal prices, we have conducted price inspections in major coal-producing areas and severely punished 21 companies that violated the law. To address issues related to spring farming preparations impacted by price spikes in chemical fertilizer, we have punished three fertilizer companies for driving up potash fertilizer prices. To combat instability in industrial chains caused by rising iron ore prices, we have actively provided administrative guidance, issued warnings and reminders, and conducted research and inspections. By guiding market expectations appropriately, we have effectively curbed irrational price increases.

Third, we have focused on key areas and specialty products related to people's livelihoods to resolutely protect the legitimate rights and interests of consumers. Since consumers are mostly concerned about prices in their daily lives, the SAMR has consistently adopted a people-centered approach to overseeing prices in sectors relevant to people's livelihoods, especially in areas such as education, medical care and health. We have launched special crackdown campaigns to address price-related wrongdoings in the abovementioned key sectors, with particular efforts to curb arbitrary price increases and charges. In response to problems with off-campus training, such as “fabrication, exaggeration, and inducement,” we have imposed maximum penalties on 15 agencies based on the Price Law and the Anti-unfair Competition Law. Regarding the issue of overpriced mooncakes, we organized an intensive operation regarding food security, pricing, packaging, and advertising. We conducted inspections in over 80,000 hotels, shops, and supermarkets. As many of you may have noticed, during the Mid-Autumn Festival last year, the average price of mooncakes across the country dropped significantly compared to previous years. Also, we swiftly conducted inspections on “ice cream assassins” (ice creams with unclear or hidden prices that turn out to be excessively high when it's time to pay), actively responded to public concerns, and guided businesses to strengthen self-discipline in pricing and operate in accordance with laws and regulations.

In the next step, the SAMR will diligently implement the decisions and arrangements of the CPC Central Committee and the State Council and continuously enhance the forward-looking, targeted, and effective supervision of prices, better serve the stable operation of the macroeconomy, and better safeguard the interests of the people. Thank you!

Voice of China, China Media Group: 

We understand the importance of preventing catering waste to ensure national food security and promoting a conservation-oriented society. We are also aware that the SAMR has recently launched a special campaign against food waste. Could you please provide us with an update on the latest progress and achievements of this campaign? Thank you!

Luo Wen:

Thank you for your question. My colleague Mr. Pu Chun will answer this question.

Pu Chun:

Thank you for your question. This is a very important issue. As the saying goes, "Every grain of rice and every drop of congee should be cherished." Thrift and frugality are traditional virtues of the Chinese nation and an unshakable tradition of our Party. The SAMR has consistently prioritized the rectification of catering waste, with a persistent focus on setting standards, establishing systems, enhancing supervision, enforcing strict laws, conducting extensive publicity, and providing guidance to promote widespread efforts across society to prevent catering waste.

In March of this year, the SAMR launched a special three-month campaign to combat catering waste within the national market supervision system. The aim is to address outstanding issues, uncover illegal cases, develop group standards, and promote exemplary models in order to foster a positive social culture of frugality and anti-waste. The national market regulatory authorities have mainly focused on the following areas of work.

First, we have intensified regulatory oversight to establish effective constraints. By integrating the prevention of catering waste into the "two responsibilities " framework for food safety, which involved the primary responsibility of food production and operation entities and the responsibility of local government management for food safety, we ensured its implementation and supervision. We have also organized actions such as "random inspections of restaurants" and enforced swift and strict investigation and punishment for illegal cases of catering waste. By the end of March, a total of 2.595 million catering service operators had been urged to conduct self-inspections, resulting in the investigation and resolution of 2,423 cases of illegal behavior, with 229 typical cases publicly announced and exposed.

Second, we have strengthened guidance and leveraged the benefits of role model demonstration. We have studied and formulated the Guiding Opinions on Implementing the Responsibility of the Main Entities of Online Catering Platforms to Effectively Prevent the Waste of Takeaway Food, urging the leading takeaway platforms to play a demonstrating and leading role. We have guided the formulation of comprehensive prompts throughout the entire process, refined the portion descriptions, adjusted the discount for meeting the minimum order requirement, promoted specific measures such as "small portion, small dishes," and established a reward mechanism, which has all helped to promote a standardized and healthy takeaway food ordering industry.

Third, we led by setting standards and establishing long-term mechanisms. We have included food conservation, waste reduction, and prevention of catering waste in the 2023 Guideline on National Standard Establishment , providing strong support for these key areas. We are also promoting the formulation of national standards, such as the Guidelines for Assessing the Effectiveness of Anti-Food Waste Measures in Canteens of Government Organs, and have approved the release of the Credit Rating Evaluation Criteria for the Hospitality Industry to link corporate credit with anti-waste efforts. Furthermore, we are facilitating industry organizations to jointly develop six group standards for preventing catering waste.

Fourth, we are focusing on publicity and guidance and fostering a joint-governance atmosphere. We have organized industry associations to issue joint initiatives, advocating for an increased awareness of food conservation and resistance to wasteful behaviors among enterprises and consumers. We have conducted activities on campuses to promote anti-food-waste knowledge, with anti-food-waste knowledge promotion videos simultaneously played in 371 universities and colleges, reaching over 1 million views. We have also provided guidance to local governments to carry out activities promoting relevant standards and legal knowledge on preventing catering waste, with 5,914 events held and 2.253 million catering industry practitioners trained, receiving positive feedback from society.

Stopping food waste requires the collective participation of the entire society, and it should be a sustained and persistent effort. We have taken the opportunity at this press conference to urge the media to pay more attention to efforts in combating food waste. Let us all become practitioners, advocates, and watchdogs of the "Clear Your Plate" campaign, working together to promote a civilized, healthy, and sustainable dining consumption philosophy. Thank you!

21st Century Business Herald:

Food safety is a major issue concerning people's well-being, and implementing food safety responsibilities is fundamental to food safety. What work has the SAMR done to promote the implementation of food safety responsibilities? And what are the work arrangements for the next step? Thank you.

Luo Wen:

Thank you for your questions. General Secretary Xi Jinping has repeatedly emphasized that food safety should be treated as a crucial political task that involves both the Party and government officials assuming responsibilities. He emphasized the need for the strictest standards, oversight, punishment and accountability to ensure food safety . In September last year, the Food Safety Commission of the State Council specially issued a document, making plans for localities to establish and improve a working mechanism featuring tiered, differentiated, targeted control, and end-to-end efforts to promote the fulfillment of local governments' management responsibilities for food safety. At the same time, the SAMR also issued department regulations requiring enterprises to appoint food safety directors and officers in accordance with the law. This ensures that the main responsibility for the company's food safety is fulfilled by the "smallest work unit," meaning people in charge can be identified, problems can be investigated, and responsibility can be assigned. Centering on promoting the implementation of the responsibilities of all parties, we will take the following steps this year.

First, we will see that enterprises shoulder primary responsibility. We will supervise and guide them to formulate a food safety risk management and control list based on factors such as production, business operations, scale, food categories, and risk levels. The list will be incorporated the enterprise's overall production and business operation process. Meanwhile, we will urge enterprises to appoint food safety directors and food safety officers, and see that the food safety officers strictly enforce daily management and control measures, the safety directors conduct weekly investigation, and the person in charge of the enterprise schedules monthly follow-ups. In addition, all these activities shall be recorded and archived in a truthfully manner for future reference.

Second, we will urge local governments to fulfill their due responsibilities within their jurisdiction. Through the implementation of the guarantee system, we divide all food production and operation entities in China into four levels, A, B, C, and D, according to their scale and business type, and correspond to the four levels of guarantee officials at the city, county, township, and village, ensuring that each entity is overseen by officials. At the same time, the system of "three lists plus a letter of commitment" is implemented for officials in charge. The responsibility list specifies which companies each guarantee official will be specifically responsible for. The task list defines the specific tasks of each guarantee official. The inspection list specifies the inspection items from the upper to the lower level. The letter of commitment means that the officials in charge shall sign a responsibility and task commitment letter with the competent authorities and file it for future reference. Adopting the above-mentioned systems allows local governments' responsibilities to be promoted in a specific, practical, and implementable way.

Third, we will strictly implement the responsibilities of relevant departments. We will guide market supervision departments at all levels to focus on the implementation of the "daily control, weekly investigation, and monthly scheduling" system by food enterprises as a key aspect of supervision and inspection. Enterprises that fail to fulfill their main responsibilities in accordance with the regulations shall be ordered to make corrections and, depending on actual circumstances, may face fines, suspension of production and business operations, or license revocation.

In short, through the establishment and improvement of the food safety responsibility sharing and implementation mechanism, we aim to ensure the two "key minorities" of local Party and government leaders, as well as enterprise safety management personnel, truly fulfill their "last-kilometer" responsibilities. By promoting the primary responsible parties to fully exert their power, we can achieve lasting impact on food safety and fundamentally guarantee its security. Thank you.

China Daily:

Special equipment safety is closely related to people's daily life and production and is connected to the life and property safety of the general public. With the upsurge of efforts to boost the economy in various places, the production pace of enterprises has accelerated after resuming operations. How can we ensure the safety of special equipment to avoid accidents? Thank you!

Tian Shihong:

Thank you. As the China Daily reporter just said, special equipment safety is closely related to daily life and production. It includes not only the safety of pressure-bearing special equipment such as boilers, pressure vessels, pressure pipes, and gas cylinders, but also the safety of special electromechanical equipment such as elevators, passenger ropeways, large amusement facilities, hoisting machinery, and special vehicles used in factories.

With a commitment to safe development, the market regulatory departments have been working to enhance the supervision of special equipment safety. We have been conducting comprehensive investigations to identify and eliminate potential risks associated with special equipment, thereby effectively preventing accidents involving such equipment. As of now, the number of accidents and deaths related to special equipment has decreased by 52% and 36.84%, respectively, compared with the same period last year. No major special equipment accidents have occurred, and the overall safety situation of special equipment in China remains stable.

At the same time, we also need to recognize that special equipment is growing rapidly. The total amount of special equipment is large, with a significant stock of old equipment and a fast growth rate of new equipment. The number of existing special equipment has reached 19,917,300 units. Take elevators as an example; there are 9,982,500 elevators in operation nationwide, transporting more than 2 billion people daily. Among them, 736,800 old elevators have been in operation for more than 15 years, while the growth rate of new elevators added every year is about 10%. At present, large-scale, high-parameter and high-risk special equipment continues to grow, and new materials, processes, and equipment are emerging, along with all kinds of new risks and hazards. At the same time, some enterprises have insufficient safety awareness in the management of special equipment usage, imperfect management systems, and only perform superficial daily maintenance. The phenomenon of operators working without a certificate still exists, which increases the risk of special equipment accidents. In the next step, the SAMR will continue to strengthen the supervision of special equipment safety, urge enterprises to implement their main responsibility for safety, and jointly safeguard the bottom line of special equipment safety, creating a good environment for high-quality development. Specifically, we have several measures in place:

First, we will effectively strengthen the responsibility for safety supervision. We will encourage local governments at all levels to fulfill their local management responsibilities, coordinating and rectifying major safety hazards regarding special equipment. Focusing on the requirement that “managing an industry necessitates ensuring safety,” we will clarify the management responsibilities of relevant industry sectors. Meanwhile, we will also emphasize the role of the special equipment safety joint meeting mechanism within the security commission at all levels, promoting the formation of a joint management and work approach. Market regulatory authorities at all levels will further improve the risk prevention and control mechanism for special equipment, intensify administrative law enforcement, establish connections with criminal justice, and reinforce credit punishment. This will ensure the effective implementation of regulatory measures.

Second, we will emphasize the main responsibility of enterprises. We will formulate and implement regulations for the supervision and management of special equipment production and usage, ensuring enterprises fulfill their responsibilities. We will establish a safe work mechanism that involves daily control, weekly inspections, and monthly scheduling. We will urge enterprises to appoint safety directors and officers, clarify the safety responsibilities of the main responsible person of the enterprise, standardize the behavior of safety managers, and enforce the accountability of the main body of the enterprise. Market regulatory authorities will fully deploy activities to promote corporate responsibility, urging enterprises to firmly establish a safety bottom-line mindset and strictly implement production safety measures.

Third, we will carry out special equipment safety rectification. We will focus on increasing special equipment supervision and inspection efforts in schools, hospitals, amusement parks, tourist attractions, and other public gathering places. At the same time, we will carry out special rectification activities targeting accident-prone weak links, such as town gas pressure pipelines, high-pressure gas cylinders, small boilers, passenger ropeways, and unregistered illegal use of special equipment. We will also strengthen supervision and inspection efforts in key periods, key regions, and key areas, especially ensuring the safety of special equipment during holidays, festivals and major activities, to resolutely prevent and curb the occurrence of serious accidents. Thank you!

Bauhinia Magazine:

In recent years, China has investigated and handled a number of cases of market and administrative monopolies, which has aroused public attention. What follow-up measures will be taken, and how can we better protect and promote fair competition? Thank you.

Gan Lin:

Thank you for your questions. Just now, when I answered the question from the reporter from Kyodo News, I partially addressed your question. Your question encompasses a broader scope, including both market and administrative monopolies. As you just mentioned, in recent years, we have resolutely implemented the decisions and plans of the Party Central Committee and the State Council and investigated and handled a number of representative cases in accordance with the Anti-Monopoly Law, which has aroused public attention and yielded satisfactory results. Next, acting upon the plans and requirements of the 20th CPC National Congress on combatting monopolies and promoting fair competition, we will give equal emphasis to standardizing supervision and promoting development. The measures mainly include the following four aspects:

First, we will further improve the supply of laws and regulations to cement the foundation of the rule of law for fair competition. We will reinforce the foundational role of fair competition policies and ensure the implementation of the Anti-Monopoly Law. Meanwhile, we will intensify efforts to amend the Anti-Unfair Competition Law, improve supporting regulations and rules for anti-monopoly, such as standards for reporting business concentrations, and take solid steps to enhance the operability and predictability of laws and regulations so as to ensure that enterprises have a clearer understanding of the regulatory rules and law enforcement procedures and have greater confidence in the market environment.  

Second, we will further regulate the improper intervention of administrative power in market competition to break local protectionism and administrative monopolies. We will move faster to improve the fair competition review system by promoting the formulation of regulations and enhancing third-party evaluation mechanisms. Regular spot checks and inspections will also be conducted. We will strengthen law enforcement to prevent and stop abuse of administrative power to exclude and restrict competition. We will delimit the rules and improve the code of conduct to reinforce the authority of regulation and enhance the hard constraints on law enforcement. With all these efforts, we will promote the smooth flow of goods and resources in a wider scope.

Third, we will further enhance the quality and efficiency of the anti-monopoly Law enforcement to maintain market order for fair competition. We will take solid steps to carry out our pre-deployed law enforcement to counter monopolies in areas that are important to people's well-being and promptly address violations of the competition law that are of great concern to the people. We will strengthen the review of business concentrations in key areas and further improve case-handling efficiency and review quality. We will advance the building of the compliance management system for fair competition between businesses and continuously optimize the market competition environment.

Fourth, we will further improve the governance capacity for fair competition to expand the influence of anti-monopoly both at home and abroad. We will continue to strengthen publicity and advocacy for fair competition, organize a publicity week for China's fair competition policies, and release annual reports on the enforcement of anti-monopoly and anti-unfair competition laws on a regular basis to create high-quality publicity brands. We will deepen international cooperation to combat monopolies, align with high-standard international competition rules, and actively participate in the governance of international competition to boost market competition and innovation dynamism for a better market environment. With these efforts, we will make greater contributions to accelerating the creation of a new development pattern and the pursuit of high-quality development. Thank you.

Shou Xiaoli:

Please raise your hand if you still have a question. The last question, please. 

Economic Daily:

The Central Economic Work Conference has put forward that we should step up efforts to develop the digital economy, enhance regular oversight, and support platform enterprises to fully play their roles. As the major regulator for the platform economy, what specific measures will be taken by the SAMR in this regard, and what will be done to support the healthy development of the platform economy? Thank you!

Luo Wen:

Thank you for your questions. The CPC Central Committee with Comrade Xi Jinping at its core has attached great importance to the status and role of the digital economy and has made a series of major decisions and plans. The market regulation departments have conscientiously studied and implemented the important instructions of General Secretary Xi Jinping, followed the underlying principles of the development of digital economy, and continuously strengthened regular regulation of internet platforms. We will mainly take measures in the following five aspects to guide the healthy development of internet platforms.

First, we will increase the supply of rules and institutions to create a stable, transparent, and predictable institutional environment. We will establish sound basic rules and institutions in the digital economy and improve supporting institutions such as guidelines, guidance, and standards. By means of open, impartial, and transparent rules and institutions, we will send a clear and definite signal to the market to stabilize market expectations and boost confidence in development.

Second, we will work on improving the regulation mechanisms to enhance the efficient coordination of the internet platforms regulation. We will research and explore ways to establish and improve a multi-layered and tiered regulatory responsibility system with hierarchical correspondence. We will give full play to the role of the comprehensive coordination mechanism, such as the joint meeting mechanism for internet market regulation, improve inter-departmental coordinated law enforcement, and explore the establishment of a regional integration mechanism for communication, coordination, synergy, and cooperation.

Third, we will develop new models of regular regulation to see that internet platform enterprises fulfill their primary responsibilities in compliance management. Focusing on key aspects of compliance management and following the principles of operability, realization, and examination, we will improve the dynamic management of compliance risks on internet platforms. We will also establish evaluation indicators for compliance in specific areas, and develop measures such as spot checks and assessment by government departments, regular regulation, positive incentives, and punishment for rule violations to ensure that internet platform enterprises conscientiously fulfill their primary responsibility.

Fourth, we will advance digitalization to enhance the capacity and level of smart regulation. We will take active steps to explore the application of new technologies, including big data, blockchain, and AI in the regulation and law enforcement of internet platforms. We will speed up the development of a national platform for regulating online trading, strengthen monitoring, early warning systems, risk prevention and control, and focus on enhancing look-through regulation capacities. This will allow us to achieve unified command and coordination, quick response, prompt treatment, and more accurate, timely, and effective regulation.

Fifth, we will optimize service measures to better unleash the growth potential of the digital economy. We will focus on establishing national demonstration zones for internet market regulation and service and support local authorities in developing new regulatory and service models. We will actively cultivate internet-based business entities, foster the development of industrial clusters, and protect the legitimate rights and interests of all parties in accordance with the law. At the same time, we will further optimize the business environment and guide internet platform enterprises to achieve open and innovative development to empower the digital economy. Thank you. 

Shou Xiaoli:

Thanks to Mr. Luo Wen and all of the speakers, as well as our friends from the media for their participation. Today's briefing is hereby concluded. See you.

Translated and edited by Zhu Bochen, Guo Yiming, Zhou Jing, Li Xiao, Lin Liyao, Xu Xiaoxuan, Cui Can, Zhang Rui, Yan Bin, Liu Caiyi, Xu Kailin, Wang Wei, He Shan, Ma Yujia, Zhang Junmian, Yuan Fang, Huang Shan, Wang Yiming, Li Huiru, Liu Qiang, David Ball, Tom Arnsten, and Jay Birbeck. In case of any discrepancy between the English and Chinese texts, the Chinese version is deemed to prevail.

Read in Chinese

Speaker:

Mr. Fu Linghui, spokesperson of the National Bureau of Statistics (NBS) and director general of the Department of Comprehensive Statistics of the NBS

Chairperson:

Ms. Shou Xiaoli, deputy director general of the Press Bureau of the State Council Information Office (SCIO) and spokesperson of the SCIO

Date:

April 18, 2023

Shou Xiaoli:

Ladies and gentlemen, good morning. Welcome to this press conference held by the State Council Information Office (SCIO). This is a regular briefing on China's economic data. Today, we are joined by Mr. Fu Linghui, spokesperson of the National Bureau of Statistics (NBS) and director general of the Department of Comprehensive Statistics of the NBS. Mr. Fu will brief you on China's economic performance in the first quarter of 2023, and then take your questions.

Next, I'll give the floor to Mr. Fu.

Fu Linghui:

Friends from the media, good morning. I'm very glad to attend today's press conference. As usual, I will start by briefing you on the economic performance in the first quarter of this year, and then take your questions.

In short, China's national economy got off to a generally stable start in the first quarter.

In the first quarter, faced with the grave and complex international environment as well as arduous tasks to advance reform and development, and ensure stability at home, under the strong leadership of the Central Committee of the Communist Party of China (CPC) with Comrade Xi Jinping at its core, all regions and departments strictly implemented the decisions and arrangements made by the CPC Central Committee and the State Council, made economic stability the top priority, pursued progress while ensuring stability, fully and faithfully applied the new development philosophy on all fronts, accelerated efforts to foster a new development pattern, focused on promoting high-quality development, better balanced domestic and international imperatives, coordinated the COVID-19 prevention and control work with economic and social development, ensured both development and security, and gave priority to ensuring stable growth, employment and prices. As a result, a smooth transition in COVID-19 prevention and control to the new phase was secured in a relatively short time, production and demand registered a stable recovery, employment and prices were kept generally stable, residents' incomes continued to rise, market expectations saw a significant improvement, and the national economy got off to a good start.

According to preliminary estimates, the gross domestic product (GDP) in the first quarter reached 28,499.7 billion yuan, up by 4.5% year on year at constant prices, or up by 2.2% compared with the fourth quarter of 2022. By industry, the value added of the primary industry was 1,157.5 billion yuan, up by 3.7% year on year; that of the secondary industry was 10,794.7 billion yuan, up by 3.3%; and that of the tertiary industry was 16,547.5 billion yuan, up by 5.4%.

First, agricultural production was stable and animal husbandry grew steadily. 

In the first quarter, the value added of agriculture (crop farming) witnessed a year-on-year increase of 3.6%. The winter wheat growth was generally normal and the spring farming and preparations were carried out in an orderly manner. According to the year-round planting intention survey, the planting area intended for wheat, rice and corn nationwide was generally stable. In the first quarter, the output of pork, beef, mutton and poultry was 24.56 million metric tons, up by 2.5% year on year. Of this total, the outputs of pork, beef, mutton and poultry rose by 1.9%, 5.1%, 5.0% and 3.2%, respectively. The output of milk was up by 8.5% and that of eggs up by 2.8%. At the end of the first quarter, the number of pigs registered in stock was 430.94 million, up by 2.0% year on year; and 198.99 million pigs were slaughtered, up by 1.7% in the first quarter.

Second, industrial production recovered gradually and the expectations of enterprises improved generally.

The total value added of industrial enterprises above designated size grew by 3.0% year on year in the first quarter, 0.3 percentage point higher than that in the fourth quarter of 2022. In terms of sectors, the value added of mining increased by 3.2%, that of manufacturing increased by 2.9%, and that of production and supply of electricity, thermal power, gas and water increased by 3.3%. The value added of equipment manufacturing increased by 4.3%, 2.5 percentage points higher than that in the first two months. Analysis by ownership types showed that the value added of state holding enterprises was up by 3.3%; that of share-holding enterprises was up by 4.3%; that of enterprises funded by foreign investors or investors from Hong Kong, Macao and Taiwan was down by 2.7%; and that of private enterprises was up by 2.0%. In terms of products, the production of solar cells and new-energy vehicles increased by 53.2% and 22.5%, respectively. In March, the value added of industrial enterprises above designated size grew by 3.9% year on year, 1.5 percentage points higher than that in the first two months, or up by 0.12% month on month. In March, the Manufacturing Purchasing Managers' Index (PMI) stood at 51.9%, and the Production and Operation Expectation Index was 55.5%. In the first two months, the total profit of industrial enterprises above designated size was 887.2 billion yuan, down by 22.9% year on year.

Third, the service sector rebounded markedly and contact-intensive services grew quickly.

In the first quarter, the value added of services rose by 5.4% year on year, 3.1 percentage points higher than that in the fourth quarter of 2022. Specifically, the value added of accommodation and catering, information transmission, software and information technology services, financial intermediation, leasing and business services and wholesale and retail grew by 13.6%, 11.2%, 6.9%, 6.0% and 5.5%, respectively. In March, the Index of Services Production increased by 9.2% year on year, 3.7 percentage points higher than that in the first two months. Specifically, the Index of Services Production of accommodation and catering, information transmission, software and information technology services and transport, storage and post increased by 29.9%, 12.0% and 11.9%, respectively, which were 18.3 percentage points, 2.7 percentage points and 7.7 percentage points higher than in the first two months. In the first two months, the business revenue of service enterprises above designated size grew by 3.4% year on year. In March, the Business Activity Index for Services stood at 56.9%, and the Business Activity Expectation Index was 63.2%. Among these, the Business Activity Index for industries including retail, railway transportation, road transportation, air transportation and leasing and business services were above 60.0%.

Fourth, market sales recovered quickly and upgraded goods increased largely.

In the first quarter, the total retail sales of consumer goods reached 11,492.2 billion yuan, up by 5.8% year on year, and that in the fourth quarter of 2022 was down by 2.7%. Analyzed by different areas, the retail sales of consumer goods in urban areas reached 9,966.4 billion yuan, up by 5.7%, and that in rural areas was 1,525.8 billion yuan, up by 6.2%. Grouped by consumption patterns, the retail sales of goods were 10,278.6 billion yuan, up by 4.9%; and the income from catering was 1,213.6 billion yuan, up by 13.9%. Goods for basic living sold well, with the retail sales of clothes, shoes, hats and textiles as well as of grain, oil and food by enterprises above designated size increasing by 9.0% and 7.5%, respectively. Sales of upgraded goods went up markedly. The retail sales of gold, silver and jewelry and of books, newspaper and magazines by enterprises above designated size grew by 13.6% and 13.4%, respectively. Online retail sales reached 3,286.3 billion yuan, up by 8.6%. Specifically, the online retail sales of physical goods were 2,783.5 billion yuan, up by 7.3%, accounting for 24.2% of the total retail sales of consumer goods. In March, the total retail sales of consumer goods went up by 10.6% year on year, 7.1 percentage points higher than that in the first two months, or up by 0.15% month on month.

Fifth, investment in fixed assets increased steadily and investment in high-tech industries grew quickly.

In the first quarter, investment in fixed assets (excluding rural households) reached 10,728.2 billion yuan, up by 5.1% year on year, the same as that of the previous year. Specifically, investment in infrastructure grew by 8.8% year on year; that in manufacturing grew by 7.0%; and that in real estate development declined by 5.8%. The floor space of commercial buildings sold reached 299.46 million square meters, down by 1.8%; and the total sales of commercial buildings were 3,054.5 billion yuan, up by 4.1%. By industry, investment in the primary industry increased by 0.5%, that in the secondary industry grew by 8.7%, and that in the tertiary industry rose by 3.6%. Private investment went up by 0.6%. Investment in high-tech industries grew by 16.0%, of which investment in high-tech manufacturing and high-tech services grew by 15.2% and 17.8%, respectively. In terms of high-tech manufacturing, investment in manufacturing of electronic and communication equipment as well as in manufacturing of medical equipment, measuring instruments and meters grew by 20.7% and 19.9%, respectively. In terms of high-tech services, investment in e-commerce services and services for transformation of scientific and technological achievements grew by 51.5% and 51.3%, respectively. Investment in social sectors grew by 8.3%. Specifically, investment in health and education grew by 21.6% and 6.2%, respectively. In March, investment in fixed assets (excluding rural households) declined by 0.25% month on month.

Sixth, imports and exports of goods kept growing and trade structure continued to be optimized.

In the first quarter, the total value of imports and exports of goods was 9,887.7 billion yuan, an increase of 4.8% year on year. The total value of exports was 5,648.4 billion yuan, up by 8.4%. The total value of imports was 4,239.3 billion yuan, up by 0.2%. The trade balance was 1,409.0 billion yuan in surplus. The imports and exports of general trade increased by 7.9%, accounting for 65.3% of the total value of imports and exports, 1.9 percentage points higher than that of the same period last year. Imports and exports by private enterprises grew by 14.4%, accounting for 52.4% of the total value of imports and exports. In March, the total value of imports and exports was 3,709.4 billion yuan, up by 15.5% year on year. The total value of exports was 2,155.2 billion yuan, up by 23.4%; and that of imports was 1,554.2 billion yuan, up by 6.1%.

Seventh, consumer prices rose mildly, and producer prices for industrial products dropped year on year.

In the first quarter, the consumer price index (CPI) rose by 1.3% year on year. The prices for food, tobacco, and alcohol went up by 2.9% year on year. Clothing prices went up by 0.7%. Housing prices went down by 0.2%. Articles and services for daily use went up by 1.2%. Transportation and communication prices went up by 0.1%. Education, culture, and recreation prices went up by 1.7%. Medical services and healthcare prices went up by 0.9%. Other articles and services prices went up by 2.7%. In terms of food prices, fresh fruit prices went up by 11%, pork prices went up by 8.5%, grain prices went up by 2.5%, and fresh vegetable prices went down by 2.9%. The core CPI, excluding food and energy prices, grew by 0.8% year on year. In March, the country's CPI went up by 0.7% year on year and down by 0.3% month on month.

In the first quarter, the producer prices for industrial products went down by 1.6% year on year. Specifically, the prices in March dropped by 2.5% year on year, and maintained the same level month on month. In the first quarter, the purchasing prices for industrial producers went down by 0.8% year on year. Specifically, in March, the prices dropped by 1.8% year on year, and maintained the same level month on month.

Eighth, employment was generally stable, and the surveyed unemployment rate in urban areas declined.

In the first quarter, the urban surveyed unemployment rate averaged 5.5%, down by 0.1 percentage point compared with the fourth quarter of last year. In March, the surveyed unemployment rate in urban areas was 5.3%, down by 0.3 percentage point compared with the previous month. The surveyed unemployment rate of population with local household registration was 5.1%, and that of population with non-local household registration was 5.6%, of which the rate of population with non-local agricultural household registration stood at 5.3%. Specifically, the surveyed unemployment rates of the population aged from 16 to 24 and from 25 to 59 were 19.6% and 4.3%, respectively. Among the population aged 25 to 59, surveyed unemployment rates of those with junior secondary school education or below, with senior secondary school education, with junior college education, or with university education or above were 4.8%, 4.8%, 4%, and 3.1%, respectively. The urban surveyed unemployment rate in 31 major cities was 5.5%, 0.2 percentage point lower than that of the previous month. Employees of enterprises worked 48.7 hours per week on average. By the end of the first quarter, the number of rural migrant workers totaled 181.95 million.

Ninth, residents' incomes increased steadily, and rural residents' incomes grew faster than those of urban residents. 

In the first quarter, the country's per capita disposable income was 10,870 yuan, a nominal growth of 5.1% year on year, which was 0.1 percentage point faster than that of the previous year; real growth was 3.8% after deducting price factors. In terms of permanent residence, the per capita disposable income of urban residents was 14,388 yuan, a nominal growth of 4% year on year and a real growth of 2.7%, while the per capita disposable income of rural residents was 6,131 yuan, a nominal growth of 6.1% year on year and a real growth of 4.8%. In terms of income sources, the country's per capita salary income, net business income, net property income, and net income from transfers grew by 5%, 5.8%, 4.1%, and 5.1% in nominal terms, respectively. The median nationwide per capita disposable income of residents was 8,895 yuan, with a nominal growth of 4.6% year on year.

Generally speaking, in the first quarter, the national economy showed a steady recovery and made a positive start. This was due to multiple policies and measures aimed at stabilizing growth, employment, and prices that took effect early on, exhibiting positive effects as COVID-19 prevention and control measures shifted to their new phase in a rapid and steady way. However, it's important to note that the international environment is still complex and volatile and that inadequate domestic demand remains prominent, meaning that the foundation for economic recovery is not yet solid. To address these challenges, we must take Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era as the guideline, fully implement the guiding principles of the 20th CPC National Congress as well as the first and second plenary sessions of the 20th CPC Central Committee, act in line with the plans and arrangements made at the Central Economic Work Conference and the “two sessions,” make economic stability the top agenda, and pursue progress while ensuring stability. We must fully and faithfully apply the new development philosophy on all fronts, accelerate efforts to create a new pattern of development, strive to pursue high-quality development, implement macro policies in a scientific and targeted manner, and unleash the potential of domestic demand through a variety of means and channels. We must intensify efforts to deepen reforms, promote high-standard opening up, advance the overall improvement of economic performance continuously, and endeavor to achieve the effective enhancement of quality and reasonable growth so as to ensure a good start for building a modern socialist country in all respects.

Thank you.

Shou Xiaoli:

Thank you, Mr. Fu. The floor is now open for questions. Please identify the media organization you work for before asking your questions.

Shenzhen TV:

What contributed to a rebound in industrial production in the first quarter? What positive changes have emerged in industrial production and operation? Will industrial production continue to accelerate in the future? Thank you.

Fu Linghui:

Industrial production achieved steady growth in the first quarter. Since the beginning of this year, there have been several positive changes in industrial production, due to a rapid and stable shift of epidemic prevention and control measures, the implementation of policies for stabilizing growth, a rebound in market demand, and an accelerated recovery of industrial and supply chains. In the first quarter, the value added of industries above designated size increased by 3% year on year, an increase of 0.3 percentage point from the fourth quarter of last year. In March, it increased by 3.9%, an increase of 1.5 percentage points from the January-February period. There are several characteristics.

First, most industries have maintained growth. In the first quarter, of the 41 major industrial categories, 23 maintained year-on-year growth, accounting for over 50% of the total. Compared with the fourth quarter of last year, 20 industries saw rapid growth in their value added.

Second, equipment manufacturing has played a significant role in supporting industrial growth. As China advances its industry upgrading and strengthens the development of equipment manufacturing, industrial production has maintained relatively fast growth. In the first quarter, the value added of equipment manufacturing increased by 4.3% year on year, which was 1.3 percentage points higher than that of industries above designated size. Its contribution to the growth of industries above designated size reached 42.5%. Among them, the value added of electrical machinery, and railway and shipping industries increased by 15.1% and 9.3%, respectively.

Third, the raw material manufacturing industry grew rapidly due to steady economic recovery and stable investment growth. In the first quarter, the value added of raw material manufacturing increased by 4.7% year on year, which was 1.7 percentage points higher than that of industrial enterprises above designated size. Among them, the value added of the ferrous metal smelting and rolling processing industry and the non-ferrous metal smelting and rolling processing industry increased by 5.9% and 6.9%, respectively. In terms of products, the output of steel and 10 kinds of non-ferrous metals increased by 5.8% and 9%, respectively, in the first quarter.

Fourth, micro and small enterprises recovered their production. In the first quarter, the value added of micro and small enterprises above designated size increased by 3.1% year on year, and the growth rate was faster than that of all industrial enterprises above designated size. The questionnaire survey showed that the business climate index of micro and small industrial enterprises under designated size increased by 1.7 percentage points from the fourth quarter of last year, and the proportion of enterprises with good production and operation increased by 1.2 percentage points.

In addition, business expectations are higher. The manufacturing PMI has been above 50 for three consecutive months. Green products such as new-energy vehicles and solar cells have maintained double-digit growth, and the green transformation of industries has continued to grow.

But we must also remain clear-eyed about the complex and grim international environment, including uncertainties in external demand growth, constraints on and insufficiency of domestic market demand, industrial products' falling prices, and difficulties faced by companies. Going forward, we will continue to implement various policies and measures for stabilizing growth, focus on boosting domestic demand, deepen supply-side structural reform, upgrade traditional industries, foster and strengthen emerging industries, and push for a dynamic balance between supply and demand at a higher level and the healthy development of industries.

Thank you.

CCTV:

The Chinese economy has stabilized and rebounded in the first quarter of this year. What are the main features? What is your assessment of the economy in the first quarter? Thank you.

Fu Linghui:

I know there is a lot of interest in China's economic performance in the first quarter. Since the beginning of this year, all regions and government departments have thoroughly implemented the decisions and plans of the Central Committee of the Communist Party of China and the State Council, given priority to stability, sought progress while maintaining stability, promoted high-quality development, and made great efforts to ensure steady growth, employment, and prices. We have adopted proactive and effective macro policies, and made steady and quick shifts in terms of epidemic prevention and control. Work and life have been returning to normal at a faster pace, production and demand have stabilized and rebounded, jobs and prices have become basically stable, business expectations have significantly improved, positive factors have been cumulatively increasing, and the economy has gotten off to a good start. The main features are as follows.

First, economic growth has stabilized and rebounded. In the first quarter, GDP grew by 4.5% year on year, 1.6 percentage points higher than that of the fourth quarter of last year and 2.2% up from the previous quarter. It has grown faster than in the past. Agriculture has maintained steady growth. Preparation for spring planting has been advancing in an orderly manner. Animal husbandry has grown steadily, and agricultural production has remained stable. In the first quarter, the value added of agriculture, forestry, animal husbandry, and fisheries increased by 3.8% year on year, and the output of pork, beef, mutton, and poultry meat increased by 2.5%. Industrial production has recovered steadily. In the first quarter, the value added of industrial enterprises above designated size increased by 3% year on year, 0.3 percentage points higher than that in the fourth quarter of last year. The service sector has witnessed a marked rebound in growth rate. In the first quarter, the value added of the service sector grew 5.4% year on year, 3.1 percentage points higher than that in the fourth quarter of last year. The service sector, with face-to-face engagements among a significant number of people, previously hit hard by COVID-19, has especially recovered very fast.

Second, domestic demand has been expanding. Market sales have turned to increase. More opportunities and greater expectations to spend have driven market sales to expand and consumer spending in the service sector to rebound notably. In the first quarter, the total retail sales of consumer goods rose 5.8% from a year earlier, compared with a 2.7% decrease in the fourth quarter of last year. Retail sales in the service sector have demonstrated a good recovery momentum, of which catering revenue rose 13.9%. Investment has grown steadily. In the first quarter, fixed asset investment increased by 5.1% year on year, on par with the whole of last year. Among them, infrastructure investment and manufacturing investment grew by 8.8% and 7%, respectively.

Third, jobs and prices have remained basically stable. The employment situation has improved. In the first quarter, the surveyed urban unemployment rate averaged 5.5%, down 0.1 percentage points from the fourth quarter of last year. The surveyed urban unemployment rate in March was 5.3%, down 0.3 percentage points from February. Consumer prices rose moderately, and the supply of goods and services in the market was on the whole sufficient. In the first quarter, consumer prices rose by 1.3% year on year, maintaining a moderate rise. Excluding food and energy, the core CPI rose 0.8% year on year, unchanged from that of the first two months and thus basically stable.

Fourth, solid progress has been made in high-level opening up. We have vigorously stabilized and improved foreign trade, and actively expanded trade with emerging markets and developing countries, including those along the Belt and Road. China's foreign trade has continued to show its resilience. In the first quarter, China's trade volume of goods increased by 4.8% year on year, and the trade volume of goods with countries along the Belt and Road increased by 16.8% year on year, a rapid growth. China's foreign trade has shown its resilience in a complex and grim external environment. In the first two months, China's actual use of foreign capital increased by 6.1%, among which, that of high-tech industries increased by 32%.

Fifth, transformation and upgrading have continued, and new drivers of growth have continued to grow. In the first quarter, investment in high-tech industries grew by 16% year on year, significantly outpacing overall investment growth. In the first quarter, online retail sales of physical goods increased by 7.3% year on year, accounting for 24.2% of the total retail sales of consumer goods. Green and low-carbon products have grown rapidly. In the first quarter, the output of new-energy vehicles and solar cells increased by 22.5% and 53.2%, respectively. Consumer spending has shown a significant leading role. In the first quarter, the contribution of final consumption expenditure to economic growth reached 66.6%, higher than that of gross capital formation.

Sixth, market vitality has been growing, and expectations of business entities have improved. In March, manufacturing PMI was 51.9%, staying above 50% for three months consecutively. The non-manufacturing business activity index was 58.2%, up 1.9 percentage points from the previous month and reaching a relatively high level in recent years, and the business activity index of the service sector rose to 56.9%. People flow and logistics have gained steam. In the first quarter, cargo volume increased by 5% year on year, and passenger volume increased by 26.3%. Railway passenger volume and civil aviation passenger volume increased by 67.7% and 68.9%, respectively. The operation performance of small and micro businesses has improved. In the first quarter, the value added of small and micro enterprises above the designated size increased by 3.1%, faster than the growth of all industrial enterprises above the designated size, and the index gauging the prosperity of small and micro enterprises picked up from the fourth quarter of last year.

It is not easy to make such progress in a complex and grim international environment, and it is important to see that the external environment is complex, the global economy is markedly slowing, there are a lot of factors of instability and uncertainty, and despite the recovery and rebound, the domestic economy still faces an obvious lack of demand and prominent structural issues, which requires us to further consolidate the foundation for a rebound. Going forward, we will fully implement the guiding principles of the Central Economic Work Conference and the plans in the Government Work Report, adhere to the general principle of seeking progress while ensuring stability, implement macro policies in a systemic and targeted way, unleash the potential of domestic demand, deepen reform, opening up, and innovation, push for a sustained overall economic recovery, and strive for improvements in quality and growth in quantity.

Thank you.

Market News International(MNI):

China's exports were strong in March, better than expected. Do you think this strong momentum is sustainable?

Fu Linghui:

Thank you for your question. Since this year, China's imports and exports have maintained sustained growth, following last year's good performance. It was not easy. In the first quarter, the total import and export of goods grew 4.8% year on year, of which exports grew 8.4%, maintaining a relatively fast growth. It was not easy to achieve such growth in the context of slowing world economic growth and greater external uncertainties. In the next stage, China's import and export growth is facing certain pressure, mainly in the following ways: First, the world economy is growing weakly. According to the IMF forecast, the global economy is expected to grow by 2.8% in 2023, a significant drop from last year's growth rate. According to the latest WTO forecast, the volume of global merchandise trade will grow by 1.7% in 2023, which is significantly lower than last year. Second, external uncertainty is relatively large. Inflation levels in the U.S. and Europe have been relatively high so far this year, and monetary policies have continued to tighten. Recently, some bank liquidity crises in the United States and Europe have been exposed, which has increased the instability in economic operations. At the same time, geopolitical risks still exist. Rising unilateralism and protectionism have also exacerbated instability and uncertainty in global trade and economy.

Despite these pressure and challenges, China's foreign trade is resilient and dynamic. With various policies stabilizing foreign trade, the year is expected to achieve its goal of promoting stability and improving quality. First, China's industrial system is relatively complete, the supply chain is relatively strong, and it can adapt to changes in the foreign demands. Second, China insists on expanding opening up to the outside world and constantly expanding foreign trade. In the first quarter, China's imports and exports with countries along the Belt and Road grew by 16.8%, and imports and exports with other RCEP member countries grew by 7.3%, of which exports grew by 20.2%. Third, China's foreign trade has increasingly been driven by new growth momentums. Recently, the General Administration of Customs press conference also mentioned the first quarter growth of 66.9% in exports of electric passenger cars, lithium batteries, and solar cells. Cross-border e-commerce and other new business forms in foreign trade also grew relatively fast. Going forward, the policies designed for stabilizing foreign trade will continue to show results, which is conducive to achieving the goal of promoting stability and improving the quality of foreign trade throughout the year. Thank you.

Reuters:

Production data were satisfactory back in March, and production has now returned to pre-epidemic levels. However, consumption remains sluggish, leading to an uneven economic recovery. Will new policies be introduced to balance this situation? What will it take to convince Chinese consumers to spend more instead of putting more money in the bank?

Fu Linghui:

Thank you for your questions. From the situation in the first quarter, consumption growth has rebounded significantly. Since this year, with epidemic prevention and control making a quick and smooth transition to a new stage, pro-consumption policies have continued to pay dividends, and sales have rebounded significantly. In particular, the improvement in service consumption is more obvious. Consumption played a greater role in driving economic growth. As we have talked about, the contribution of the final consumption to economic growth in the first quarter reached 66.6%, a significant rebound over the whole of last year. Among the three major demands, consumption demand has become the most significant factor for driving economic growth. From the perspective of sales, total retail sales of consumer goods in the first quarter rose 5.8% year on year, compared with a 2.7% decline in the fourth quarter of last year, which indicates that consumption is gradually rebounding and improving.

From the main features, first, the service consumption rebounded significantly. As the impact of the epidemic gradually receded, consumption scenarios increased, and offline consumption grew quickly with residents going out for dining, entertainment and travel. In the first quarter, the catering sector saw the revenue increasing by 13.9% year on year. In the same period, the year-on-year nominal growth of national per capita consumption expenditure on services were 6.2%, significantly higher than that of national per capita consumption expenditure in total, and the national consumption expenditure on services' proportion in the national consumption expenditure in total was 0.3 percentage points higher year on year. 

Second, the growth of merchandise sales showed a positive trend. With the gradual release of consumer demand, the accelerated growth of upgraded consumption, and the continued growth of consumption required by basic living, a steady rebound has been seen in commodity sales. In the first quarter, retail sales grew by 4.9% year on year, compared with a 1.7% decline in the fourth quarter of last year. Among businesses above designated size, nearly 70% of the 18 categories of goods saw year-on-year growth in the value of retail sales. The retail sales of grain, oil, and foodstuff, and garments, footwear, hats, and knitwear, namely goods for basic living, increased by 7.5% and 9% year on year, respectively. Retail sales of gold, silver and jewelry, and cosmetics, namely nonessentials, increased by 13.6% and 5.9%, respectively.

Third, the growth of online and offline consumption accelerated. With the improvement in circulation, online consumption continues to develop in a good direction. In the first quarter, the online retail sales of physical goods grew by 7.3% year on year, continuing to maintain rapid growth. At the same time, with the recovery of offline consumption, the retail sales of physical stores gradually improved. In the first quarter, retail sales in physical stores above designated size increased by 3.6% year on year, with the growth rate 3.2 percentage points higher than in January and February.

Fourth, the propensity of residents to consume has rebounded. As the economy stabilized and rebounded, the employment situation gradually improved, the consumption scenarios continued to increase, and residents' confidence in consumption improved, which led to a rise in the average propensity to consume. In the first quarter, the national average propensity to consume was 62%, an increase of 0.2 percentage points over the same period last year.

In general, overall consumption has restored the good momentum. But we note that consumer spending needs to be further encouraged. Going forward, we must use every possible means to increase people's incomes, and work actively to increase supply quality to effectively combine expanding consumption with supply-side structural reform, which will unleash consumption potential, promote economic development and improve people's wellbeing. Thank you.

Nikkei: 

My question is about the CPI. China's core CPI rose 0.7% in March from a year earlier. Despite the Chinese economy having started to recover after adjusting the COVID-19 response, the year-on-year increase in the core CPI is still low. How does the NBS view the main reasons for the stagnant core CPI? Is China's economy at risk of deflation? Thank you.

Fu Linghui: 

Prices are an important concern among the public. There has been a lot of discussion recently about whether China's economy is heading for deflation. Generally speaking, the Chinese economy has not experienced deflation at present, and there will be no deflation in the next stage. Deflation is internationally defined as a sustained decline in the general level of prices, often accompanied by a reduction in the money supply and economic recession. However, judging from the economic performance in the first quarter in China, consumer prices increased 1.3% year on year, maintaining a moderate rise. In terms of money supply, the M2 money supply soared 12.7% at the end of March, maintaining a relatively high rate of growth. In terms of economic growth, China's economy grew by 4.5% in the first quarter, up from the fourth quarter of last year. There is no deflation on the whole.

We have also seen falling CPI growth in the first quarter of this year. What's the reason for the drop? It is mainly affected by some time-related factors.

First, it is due to seasonal factors. Following the Chinese Lunar New Year, which fell in January this year, prices generally drop as demand declines.

Second, some food prices have fallen. As it gets warmer, supplies of fresh vegetables have increased substantially, with prices dropping both month on month and year on year. Thanks to this year's adequate hog supplies and reduced post-holiday consumer demand, pork prices have fallen. All these have led to a decline in the CPI. 

Third, energy prices have decreased. For China's CPI, energy prices have fluctuated with the international market. Since the beginning of this year, the global economy has slowed, and prices on the international energy market, especially the crude oil market, have dropped on the whole, leading to lower domestic energy prices. In March, gasoline and diesel prices fell 6.6% and 7.3% respectively from a year earlier.

Fourth, prices of cars, especially fuel-powered cars, have dropped. Due to the expiration of automobile subsidy policies and an adjustment to emission standards, automakers have recently increased discounts. In March, fuel-powered car prices fell 4.5% from a year earlier. All these factors have affected the change in prices.

Fifth, due to the impact of geopolitics and the COVID-19 pandemic, the price base was relatively high in the same period of last year. These factors have led to a decline in the growth of CPI prices year on year.

Although CPI prices have fallen, supply and demand remained basically stable. Excluding food and energy, the core CPI rose by 0.8% year on year in the first quarter, flat from January to February, and rising 0.2 percentage points from the fourth quarter of last year. In terms of service prices, the first quarter saw a year-on-year increase of 0.8%, up by 0.3 percentage points over the fourth quarter of last year. In terms of broader price levels, the CPI mainly measures price changes in the consumer sector. If we look at price changes in the economy, we should also consider GDP deflators, which posted slight growth in the first quarter of this year, picking up from the fourth quarter of last year. If all these are taken into consideration, there is no deflation. 

Going forward, prices will recover steadily, and prices' driving role will gradually strengthen. The so-called deflation will not appear. In terms of price performance, due to the high price base of last year, and the high rise in international commodity prices, as well as tight domestic supply affected by the COVID-19 pandemic, the CPI increase was relatively high in the second quarter of last year. As a result, the CPI increase in the second quarter of this year may remain low, but this does not mean there is deflation. As the influencing factors will gradually disappear in the second half of the year, prices will return to a reasonable level.

Yicai:

What's your opinion on the investment data in the first quarter? Private investment has been low for some time, registering growth of only 0.6% in the first quarter. What are the reasons for this?

Fu Linghui:

The issue of investment has raised much attention. On the whole, China is still the largest developing country in the world. There is still a big gap between our per capita capital stock and that of developed countries. More investment is needed to address unbalanced and inadequate development, break through bottlenecks in science and technology, accelerate innovation-driven development, and promote high-quality development.

Since the beginning of this year, China has continued to expand domestic demand and give full play to the key role of investment in improving the supply structure. We have increased investment in key fields and at key links, and are actively working to expand investment in areas that are important to people's wellbeing so as to ensure and improve their lives. Steady investment growth has played a positive role in driving economic growth. In the first quarter, fixed asset investment rose by 5.1% year on year, strengthening the basis for sustained growth. Investment in China has the following characteristics:

First, manufacturing investment has experienced rapid growth. The size of China's manufacturing industry has ranked first in the world for many years and is the cornerstone of our industrial development, boasting strong competitive advantages. However, there are still many shortcomings in certain key areas. China's manufacturing industry has huge potential to transform and upgrade amid a new wave of scientific and technological revolution and industrial transformation. China places great importance on the manufacturing industry's development and actively supports manufacturing innovation. Since the beginning of this year, manufacturing investment has sustained a rapid growth rate, with a year-on-year increase of 7% in the first quarter, significantly faster than total investment growth. Specifically, investment in high-tech manufacturing grew by 15.2%.

Second, infrastructure investment has grown rapidly. While China has made remarkable progress in infrastructure construction, we still need to speed up efforts to address the disparities in infrastructure between rural and urban areas. We must strengthen our weaknesses in the areas of transportation, water conservation and energy. With the expansion of digital, intelligent and green development, there is a growing demand for new infrastructure, such as 5G networks, charging facilities and big data centers. This year, we actively advanced infrastructure construction and achieved positive results. In the first quarter of this year, China's infrastructure investment grew by 8.8% year on year, bolstering the momentum for sustainable development in the future.

Third, investment in people's livelihoods has increased. China attaches great importance to ensuring and improving people's livelihoods. In recent years, we have consistently increased spending on improving people's living standards to promote people's well-being. This year, investment in the social sectors maintained rapid growth, with a year-on-year increase of 8.3% in the first quarter. Notably, health investment grew by 21.6%, which will help protect people's health.

Generally, this year, China's investment has sustained steady growth, and its structure has continued to be optimized, benefiting both economic growth and long-term development. However, we should note that the steady growth of investment still faces some constraints. In the next phase, we will focus on improving the quality of investment and promoting high-quality economic development, considering both the present and long-term benefits.

Regarding the issue of private investment, there are many influencing factors, and one of the major aspects is the adjustment of the real estate market. Private investment in real estate development declined by 13.8% in the first quarter, dragging down the rate of increase in private investment by 5 percentage points. Of course, private investment also faces other constraints, such as the downward slide in corporate performance and unstable market expectations. Overall, actively improving the market environment and increasing support for private enterprises will help stabilize private investment. Thank you.

ITAR-TASS: 

We understand that the contribution of China's consumption to GDP growth declined during the pandemic. What's the situation like now? What are the predictions from NBS? Thank you

Fu Linghui:

Thank you for your question. This year, the contribution of consumption to economic growth has rebounded markedly. In the first quarter, the contribution of final consumption to GDP growth reached 66.6%, a significant rebound over the whole of last year. Going forward, consumption is expected to continue to play a leading role in driving economic growth. First, gradual economic recovery has improved employment, and the surveyed urban unemployment rate dropped significantly in March. This will in turn help increase personal incomes and boost capacity for consumption. Meanwhile, as the impact of the epidemic recedes and consumption scenarios expands, consumption will continue to increase. From the perspective of medium- and long-term development, China's per capita GDP reached $10,000 and consumer needs are rapidly increasing, and the long-term consumption outlook is promising. Taking these factors into consideration, consumption will play a stronger role in driving economic growth. Thank you.

Kyodo News:

What is the economic outlook for the second quarter? Will the economic data improve in the second quarter of this year? What are the major risks?

Fu Linghui:

People are most concerned about the situation in the next stage. So far this year, the Chinese economy has shown encouraging recovery momentum. The main indicators have stabilized and picked up, the vitality of business entities has increased, and market expectations have improved notably, laying a solid foundation for achieving the country's annual growth target. In the next stage, we expect the internal forces powering economic growth to strengthen gradually. We also expect macro policies to exert an obvious effect and overall economic performance to improve. Considering that the second quarter of last year was affected by the epidemic and forms a low base for comparison, economic growth in the second quarter this year is likely to be significantly faster than in the first quarter. However, due to higher comparison bases, growth might be slower in the third and fourth quarters than in the second quarter. Without considering the base effect, economic growth throughout the year will likely trend upward. The main underpinning factors are as follows:

First, the role of consumption in driving economic growth is gradually increasing, and the trend of consumption rebounding has been evident since the beginning of this year, enhancing its driving contribution to economic growth. As mentioned earlier, the contribution rate of final consumption to economic growth has increased compared to last year. With the improvement of the employment situation, the effectiveness of policies aimed at boosting consumption, and the increase in consumption scenarios, residents' consumption capacity and willingness to spend are expected to increase. At the same time, policies to actively increase spending on big-ticket items such as new energy vehicles and green and smart home appliances, to promote the integration of online and offline consumption, to develop new forms and models of consumption, and to accelerate the quality improvement and expansion of rural markets, are all conducive to the sustained growth of consumption, which in turn drives economic growth.

Second, stable growth in investment is expected to continue. Since the beginning of this year, all localities have actively advanced the construction of major projects, resulting in overall steady growth in investment. Fixed-asset investment grew by 5.1% in the first quarter. Going forward, traditional industries will continue to undergo transformation and upgrading, emerging industries will continue innovation and development, and support for the real economy is increasing, all of which are favorable for investment growth. In the first quarter, investment in manufacturing grew by 7%, outpacing overall investment growth. In the coming stage, in line with major national strategies and the 14th Five-Year Plan, we will focus our efforts on promoting infrastructure investment, aiding the further expansion of investment. In the first quarter, infrastructure investment grew by 8.8%, faster than overall investment growth. Moreover, as people's demand for buying homes or improving their housing situation increases, we have seen positive changes in real estate sales. Consequently, investment in real estate development is expected to gradually stabilize.

Third, the driving force of industrial transformation and upgrading has been enhanced. China has been fully implementing an innovation-driven development strategy, boosting its strategic scientific and technological strength, and promoting industrial upgrading and development. Technologies such as 5G networks, information technology, and artificial intelligence have developed rapidly, and new industries continue to emerge. In the first quarter, the added value of the equipment manufacturing industry increased by 4.3%, and the industrial technology intensity steadily increased. At the same time, the green and low-carbon transformation of the energy mix is accelerating, demands for new products are expanding, and more traditional industries are carrying out energy-saving and consumption-reducing transformation, all of which also enhance the driving effect. In the first quarter, the production of new energy vehicles and solar cell products maintained rapid growth. The industries' high-end, intelligent, and green development will inject new impetus into China's economic development.

Fourth, macro policies have continued to demonstrate their effectiveness. Since the beginning of this year, all localities and departments have fully implemented the guiding principles of the Central Economic Work Conference and the arrangements of the government work report. They have pursued a proactive fiscal policy with greater intensity and enhanced its performance while ensuring prudent monetary policies are precise and effective. They have focused on efforts to stabilize economic growth, employment, and prices. The policy effects have continued to emerge, and the economy's operation stabilized and rebounded in the first quarter.

In the next stage, as various decisions and arrangements made by the CPC Central Committee and the State Council are further implemented in detail, policy effects will become more evident. China's economic development momentum will continue to grow, promoting the recovery and improvement of economic operations.

Thank you.

ThePaper.cn:

Currently, China's PPI has experienced six consecutive months of negative year-on-year growth. How does the NBS view this trend of PPI? Thank you.

Fu Linghui:

There is much concern over PPI. While CPI's year-on-year increase has slowed this year, PPI's decrease has expanded. In the first quarter, PPI fell by 1.6% year on year, with a 2.3% decrease in production material prices being the main factor for the decline. The expansion of the year-on-year decline in PPI is due to two main factors. Firstly, it is influenced by imported factors from the international environment. Since the beginning of this year, the growth of the global economy has slowed down, market demand has weakened, supply bottlenecks have eased, and the prices of bulk commodities have fallen, leading to a decrease in the prices of related products in domestic industries such as petroleum and nonferrous metals. In the first quarter, prices in the nonferrous metal industry fell by 5.9% year on year, while prices in the petroleum and natural gas extraction industry fell by 5.3%. Secondly, the high base figure from the same period last year is also a factor. The international bulk commodity prices rose sharply last year, affected by geopolitical conflicts and the COVID-19 pandemic, and the domestic supply was tight due to the pandemic, which led to a year-on-year increase of 8.7% in PPI in the first quarter of last year. The relatively high base figure also affects PPI trends this year.

From the perspective of month-on-month changes, PPI has been relatively stable this year. In January, PPI fell by 0.4% compared to the previous month, while in February and March, it remained stable. The main factors are, on the one hand, the recovery of domestic market demand, which has led to a month-on-month increase in the prices of investment goods such as steel and cement. In March, the prices of steel and cement both increased by 1.3% compared to the previous month. On the other hand, prices in the petroleum extraction and nonferrous metal industries decreased by 0.9% and 0.3% month on month, respectively, under the influence of imported factors from the international market. Meanwhile, due to seasonal factors, the demand for coal has decreased, and the prices in coal mining and washing industries fell by 1.2% month on month. Under the combined influence of these factors, PPI has remained stable month on month.

Going forward, overall domestic demand is starting to rebound, which has a certain upward effect on PPI. However, the transmission of international commodity prices still exists and coupled with the high base figure from the same period last year, PPI may remain in a downward range in the short term. Nevertheless, as the domestic economy recovers and the base effect gradually diminishes, PPI will gradually return to a reasonable level. Thank you.

Voice of China, China Media Group:

Since the beginning of this year, the service industry has rebounded at a faster pace. What are the primary reasons for that? How do you interpret such a rebounding momentum? What's your prediction for the service industry's growth prospects in the next phase? Thank you.

Fu Linghui:

Since the beginning of this year, the rebound of the service sector has been a highlight of economic performance. As a crucial component of the national economy, the service sector accounts for more than half of the Chinese economy. In recent years, the growth of the service sector has slowed due to COVID-19 and other factors, having an adverse impact on economic growth and employment. As the effect of the pandemic has gradually ceased since the beginning of this year, policies to stabilize growth have taken effect at a faster pace. Meanwhile, production and life have returned to normal. The demand for services, especially contact-and-gathering-based services, has been unlocked more rapidly, and the growth of the service sector has markedly rebounded, providing strong support for economic growth and creating more jobs.

In the first quarter, the value-added output of the service sector rose by 5.4% year on year, up 3.1 percentage points from the last quarter. The service sector's contribution to economic growth reached 69.5%, becoming a key factor in supporting economic growth. In terms of structure, first, contact-and-gathering-based services rebounded rapidly. The notable increase in people's consumption of catering, shopping, tourism, and accommodation has led to growth in the relevant service sectors. In the first quarter, the value-added output of the wholesale and retail sector increased by 5.5% year on year, 5.2 percentage points higher than in the last quarter. Additionally, the value-added output of the accommodation and catering sector was up 13.6%, while the value-added output in the fourth quarter of last year was down 5.8%.

Second, the transportation sector has recovered rapidly. As production and life have returned to normal, the flow of goods and people has increased significantly. The growth in travel and transportation-related sectors has sped up. In the first quarter, the value-added output of the transportation, storage and postal service sector increased by 4.8% year on year, while in the fourth quarter of last year, it had decreased by 3.9%.

Third, the modern service sector has demonstrated sound growth momentum. With the rapid development of the digital economy in China, the demand for information technology has been expanding, which has driven rapid growth in relevant sectors of information services. In the first quarter, the value-added output of the information transmission, software and information technology service sector grew by 11.2% year on year, notably higher than the growth rate of the entire service sector. At the same time, the financial sector has kept strengthening its efforts to serve the real economy and actively satisfied the reasonable financing needs of enterprises, which has resulted in growth of value-added output in the financial sector. In the first quarter, the value-added output of the financial sector increased by 6.9% year on year.

With the rapid rebound in the service sector, enterprises' expectations in the service sector have improved markedly. Since the beginning of this year, the business activity index for services has stayed within the expansion range for three consecutive months, with the index in March standing at 56.9%, 1.3 percentage points higher than that in February, suggesting a favorable expansion trend in the service sector. The service sector has a large capacity for employment, and the recovery in the service sector will positively affect stabilizing and expanding employment.

However, we should also notice that the rebound in the service sector is still primary and in the recovery process. The foundation is not yet solid. In the next phase, we will work on expanding domestic demand, boosting personal incomes, improving the environment for consumers, and increasing the supply of quality services to promote the healthy development of the service sector. Thank you.

Shou Xiaoli:

Due to time constraints, one last question, please.

The Beijing News:

Two figures in this year's employment season have received wide attention. The number of college graduates nationwide in 2023 is expected to reach 11.58 million. Additionally, the number of doctoral graduates and master's graduates will surpass the number of university graduates for the first time this year in Beijing. Based on the statistics from the first quarter of 2023, what's your opinion on the prospects for this year's job market?

Fu Linghui:

Employment is the cornerstone of well-being and is of great concern to people. According to this year's statistics, overall employment has improved. Based on our monitoring, workforce participation in the job market has risen steadily since the beginning of this year. The unemployment rate in March decreased markedly. Total employment increased from the same period last year, with year-on-year and month-on-month increases. With the economy's recovery, the level of activity in the job market has increased gradually. Regarding the unemployment rate, the surveyed urban unemployment rate nationwide in March was 5.3%, down a 0.3 percentage points from the previous month. The main features are as follows:

First, the unemployment rate in most of the labor market has dropped markedly. As the economy rebounds, enterprises need more labor, and the number of market entities in active operation has been growing, contributing to the improvement in employment. In March, the unemployment rate among those aged between 25 and 59 was 4.3% and fell by half a percentage point from the previous month, lower than the same period in 2019.

Second, the employment of rural migrant workers has improved at a faster pace. Since the beginning of this year, the number of rural migrant workers nationwide has continued to increase. Under the joint influence of economic recovery and pro-employment policies, the employment rate of migrant workers has improved notably. In March, the unemployment rate of rural migrant workers stood at 5.3%, down a 0.7 percentage points from the previous month. The construction, wholesale, and retail sectors, where many rural migrant workers are employed, have recovered well, playing a significant role in driving the employment of rural migrant workers.

Third, the unemployment rate in large cities has dropped steadily. Affected by the epidemic last year, the unemployment rate in 31 large cities stayed at a relatively high level. Since the beginning of this year, the unemployment rate in 31 large cities has decreased as the economy has improved. In March, the surveyed unemployment rate in 31 large cities dropped to 5.5%.

However, we should also acknowledge that the youth unemployment rate has increased. In March, the unemployment rate of young people aged 16 to 24 was 19.6%, up 1.5 percentage points from the previous month. Structural employment problems are prominent. The youth unemployment rate is rising because this year's fresh college graduates have started entering the labor market to seek employment. 

In the next stage, although the youth unemployment rate is rising, it is expected to gradually improve as the economy recovers and the demand for labor expands. This year, among those aged 25 to 59, the majority of the labor market, the unemployment rate is lowest for those who have received higher education. That implies that as college graduates enter the labor market, the youth unemployment rate will gradually decrease, and the overall situation will improve. Generally speaking, the positive momentum of employment is expected to continue. Of course, we should also pay attention to certain structural problems, such as the youth unemployment rate, and efforts should be made to strengthen support for the employment of young people, especially college graduates. This will promote the sustained improvement of employment. We should also move faster to upgrade industries to provide more high-quality jobs.

Thank you.

Shou Xiaoli:

Thanks to Mr. Fu Linghui and friends from the media. Today's briefing is now concluded. Goodbye.

Translated and edited by Wang Yiming, Wang Qian, Cui Can, Wang Wei, Zhang Jiaqi, Zhou Jing, Liu Caiyi, Liu Sitong, Duan Yaying, Dong Qingpei, Yuan Fang, Zhang Rui, Huang Shan, Xu Kailin, Wang Yanfang, Li Huiru, David Ball, Tom Arnsten, and Jay Birbeck. In case of any discrepancy between the English and Chinese texts, the Chinese version is deemed to prevail.

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Read in Chinese

Speakers:

Mr. Zhang Jianhua, administrator of the National Energy Administration (NEA)

Mr. Liang Changxin, director general of the Comprehensive Affairs Department of the NEA and spokesperson of the NEA

Mr. Liu Deshun, director general of the Department of Energy Conservation and Scientific and Technological Equipment of the NEA

Mr. Li Chuangjun, director general of the Department of New Energy and Renewable Energy Sources of the NEA

Chairperson:

Ms. Xing Huina, deputy director general of the Press Bureau of the State Council Information Office (SCIO) and spokesperson of the SCIO

Date:

April 12, 2023

Xing Huina:

Ladies and gentlemen, good afternoon. Welcome to this press conference held by the State Council Information Office (SCIO). This is the 13th press conference in the series "Embarking on the New Journey — A Government Perspective." Today, we have invited Mr. Zhang Jianhua, administrator of the National Energy Administration (NEA), to brief you on fully implementing the guiding principles of the 20th CPC National Congress and advancing the high-quality development of China's energy sector, and to take your questions. Also present today are Mr. Liang Changxin, director general of the Comprehensive Affairs Department of the NEA and spokesperson of the NEA; Mr. Liu Deshun, director general of the Department of Energy Conservation and Scientific and Technological Equipment of the NEA; and Mr. Li Chuangjun, director general of the Department of New Energy and Renewable Energy Sources of the NEA.

Now, let's give the floor to Mr. Zhang for his introduction.

Zhang Jianhua:

Thank you, Ms. Xing. Ladies and gentlemen, good afternoon. I am very glad to meet with friends from the media and to brief you on the energy sector.

The CPC Central Committee with Comrade Xi Jinping at its core has attached great importance to energy-related work. The 20th CPC National Congress developed a strategic plan for comprehensively promoting national rejuvenation through a Chinese path to modernization and set clear requirements for high-quality energy development. The energy sector has adhered to the guidance of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, thoroughly studied and implemented the guiding principles of the 20th CPC National Congress, and stepped up efforts to introduce new policies and measures. The energy sector has taken the approach of "sprinting and fighting a decisive battle from the very beginning," aiming to bolster and empower socio-economic development and provide strong energy guarantees for high-quality development and Chinese modernization. 

This year marks the start of fully implementing the guiding principles of the 20th CPC National Congress. Since this year, work and life in China have recovered at a faster pace, the growth rate of industrial energy consumption has increased significantly, energy consumption has grown slightly, and national energy supply and demand have been stable on the whole. The energy sector will focus on the five aspects of energy security guarantees, clean and low-carbon transition, self-reliance and strength in science and technology, institutional innovation, and enhancing international cooperation to fully promote high-quality energy development. 

First, we will commit ourselves to consolidating energy security guarantees. We will always take ensuring national energy security as the most important mission and task, and base our work on the country's resource endowment in accordance with the principle of building the new before discarding the old. On one hand, we will make fossil fuels better meet the basic energy needs, let coal play a bigger role as an anchor of the sector, and make greater efforts to explore and develop petroleum and natural gas, discover more untapped reserves, and increase production. In this way, we aim to ensure that the country's annual crude oil output can long remain at the level of 200 million metric tons and that the self-sufficiency rate of natural gas shall not be less than 50%. We will also strengthen the underpinning and adjusting role of coal power. On the other hand, we will make non-fossil fuels a safer and more reliable alternative, and form a diversified clean energy supply system integrating wind, solar, biomass, nuclear and hydrogen energy and hydropower. We will advance the flexible transformation of coal power, and accelerate the construction of pumped power storage, peak regulation of natural gas and electricity usage, and new-type power storage facilities. We will boost the transformation and upgrading of the power distribution grid, support a high proportion of new energy's access to the power grid, and spare no efforts to peak carbon emissions and achieve carbon neutrality. At the same time, we will improve the energy security supervision and warning system, establish an energy security accountability mechanism, strengthen security risk management for large power grids, increase the ability of security risk prevention and emergency management, and go all out to ensure people's livelihoods in terms of having energy supply meet peak demand during summer and winter, adopting clean energy sources for winter heating in northern China, rural energy consumption, and charging infrastructure construction.

Second, we will accelerate the reform of energy consumption models. Our focus is on achieving "three transformations." The first is transforming the energy structure. We will strive to increase the share of non-fossil energy consumption by 1 percentage point annually over the next five years, ensure that 80% of newly added electricity will come from non-fossil fuels by 2035, and make non-fossil fuels the main source of energy by the middle of this century. The second is transforming energy systems and forms. We will accelerate the planning and development of a new-energy system, build a new type of power system, and promote the use of electricity in key areas. We will guide big data centers and industrial interruptible loads, among others, to participate in regulating the power system, and develop non-electric applications of renewable energy according to local conditions. The third is transforming the energy layout. In principle, the proportion of newly built power transmission channels for renewable energy should not be lower than 50%. We will speed up the development of distributed energy resources, coastal nuclear power and offshore wind power, so as to achieve coordinated development of energy "from afar" and "from nearby."

Third, we will accelerate our efforts to promote self-reliance and self-improvement in energy science and technology, adhering to innovation-driven development. Through implementing mechanisms such as a ranking system and a competitive selection process for choosing the best candidates to lead key research projects, we will actively cultivate core industrial chains and key links, continuously enhance our independent innovation capabilities, increase the self-reliance of major technical equipment, and better control risks. This will make industrial energy chains and supply chains more resilient and secure. We will foster the in-depth integration of energy innovation, industrial, financial, talent and data chains, advancing digital and smart energy development, with the aim of building high-end and modernized energy industrial value chains.

Fourth, we will improve and unleash the vitality of energy systems and mechanisms. Building on the foundation of the rule of law, we will accelerate the formulation of energy legislation and the revision of the Electric Power Law, the Coal Industry Law and the Law on Renewal Energy. Driven by reforms, we will establish a unified electric power market system adapted to new types of electric power systems, fully leveraging the decisive role of the market in resource allocation and eliminating barriers to system access, market transactions, and other aspects of emerging business forms and models. By leveraging supervision, we will forge a market of fair competition and further protect and stimulate the vitality of energy market entities. We will also implement policies as a safeguard to connect the green certificate market, carbon market, and electric power market in an orderly fashion, promoting coordination and collaboration between upstream and downstream energy industrial chains.

Fifth, we will work actively to open new prospects in international energy cooperation. This year marks the 10th anniversary of the Belt and Road Initiative (BRI), in which energy cooperation is an important area. We will steadfastly pursue an open strategy of mutually beneficial and win-win cooperation, advancing in-depth cooperation with key energy resource countries and reinforcing green and low-carbon energy cooperation with developing nations. We will consolidate and expand energy trade and cooperation channels, optimize overseas collaboration arrangements, and enhance coordination of investment development, project construction, equipment manufacturing, consultation, design, and financial services, among other aspects. By doing so, we will deeply engage in global energy governance and provide new opportunities to the world through China's new development. Thank you.

Xing Huina:

Thank you for your introduction, Mr. Zhang. Now, we welcome everyone to ask questions. Please identify the media outlet you represent before raising your questions.

CCTV:

The 20th CPC National Congress outlined a grand blueprint for building China into a modern socialist country in all respects and advancing the rejuvenation of the Chinese nation on all fronts through a Chinese path to modernization. What new missions and tasks will the energy industry undertake in promoting the Chinese path to modernization? Thank you.

Zhang Jianhua:

Thank you for your question; I would like to answer it. The Chinese path to modernization is a bright path for realizing the rejuvenation of the Chinese nation and embodies distinctive Chinese characteristics. The energy industry will firmly grasp the essential requirements of Chinese modernization and unswervingly pursue a high-quality development path with Chinese characteristics, contributing our energy-related efforts to building China into a modern socialist country in all respects.

First, we will provide a solid material foundation for building China into a modern country. Energy is the lifeblood of modern society, and ensuring sufficient, stable and affordable energy supplies an essential requirement for Chinese modernization. We must strengthen the foundations for energy supply security, develop clean energy supply systems such as wind, solar, hydro and nuclear power, and enhance the resilience and security of the energy industry and supply chains. This will support the building of a modern country with reliable energy supplies.

Second, we will provide essential support for building a modernized industrial system. The energy industry is characterized by its large scale, long supply chains, extensive coverage, active innovation, and strong driving effects, making it both a fundamental and strategic industry for the national economy. The energy sector will deepen the implementation of projects for upgrading industrial infrastructure and for achieving breakthroughs in key technical equipment. We will strive to foster new growth drivers, such as new energy and high-end equipment, construct a modernized infrastructure system and promote industrial transformation and upgrading.

Third, we aim to provide strong support for safeguarding national security. Energy security is crucial for national development, people's well-being, and national security. Faced with uncertain and unpredictable factors, such as geopolitical turbulence and frequent extreme weather events, the energy industry will focus on improving the levels of self-reliance, safety and control over essential resources, infrastructure, industrial chains and supply chains. This will establish a new energy security landscape that supports a new development paradigm. 

Fourth, we aim to provide significant momentum for promoting sustainable economic and social development. Energy is crucial in building an eco-civilization and transitioning to low-carbon energy, which is the key to achieving sustainable development. We must accelerate the readjustment of our energy mix, improve our capacity to develop and utilize clean energy, promote the development of green and low-carbon ways of working and living, and thus contribute to the realization of a modernization where humanity and nature can coexist harmoniously. Thank you. 

Red Star News:

A key report delivered at the opening session of the 20th CPC National Congress proposed that China should foster a world-class business environment that is market-oriented, law-based and internationalized. The guideline for improving "getting electricity" services and continuing to optimize the electricity business environment, which was deliberated and adopted by an executive meeting of the State Council, has been implemented for nearly three years. Can you brief us on the achievements of the related work and the focus of the next phase of work?

Liu Deshun:

Thank you for the question. Optimizing the electricity business environment is an important part of fostering a world-class business environment that is market-oriented, law-based and internationalized. In recent years, the NEA has led the effort to fully implement the main objectives and tasks of the guideline by organizing energy authorities and electric power enterprises in all localities. After nearly three years of efforts, improved services have been implemented nationwide. Household users and low-voltage small and micro businesses no longer require house calls, examinations, approvals or investments for electric power usage applications. High-voltage electricity users now experience more convenient, time-saving and economical application processes. Remarkable progress has been made in the following five areas: First, household power users and low-voltage small and micro businesses (160 kilowatts and below) are no longer required to pay for electricity use applications. This marks another milestone in our country's history of electric power development, following the achievement of nationwide electricity access in 2015 and the provision of dynamic electricity to all villages across the country in 2020. Second, an internet-based electricity service system has been implemented across 31 provinces, autonomous regions, and municipalities directly under the central government. This has formed a new model of electricity service that is based on information, networks, and intelligence. Internet electricity services are now accessible to everyone. Gradually, electricity services based on face scanning and providing a unified social credit code have become popular. As a result, enterprises and household users can easily access electricity services without having to go out and deal with the procedures. Third, historical breakthroughs have been made in addressing the difficulties and obstacles in accessing high-voltage electricity services. The connectivity between examination and approval management systems for government construction projects and the electric service systems of power supply enterprises has been essentially realized in all localities. Many innovative experiences have emerged, allowing power supply enterprises to acquire electricity demand in advance and thus provide proactive services. High-voltage electricity services are rapidly transforming from "projects waiting for electricity" to "electricity waiting for projects." Fourth, improved "getting electricity" services have profoundly changed the relationship between power supply enterprises and users. People's sense of gain and experiences now serve as the best criteria for evaluating power supply services. Power supply enterprises have evolved from being traditional single power suppliers to service providers of "getting electricity" access for the users. The general public has transitioned from being just electricity users to beneficiaries, overseers and promoters of improved "getting electricity" services. Fifth, the capacity of the electric power supply has improved significantly. The duration and frequency of power outrages have continued to decrease in various regions. Power supply reliability in some cities, such as Shenzhen, has reached world-class levels. 

For the next step, the NEA will further improve its service for "getting electricity" with a focus on the following three aspects of work. First, we will promote access to electricity through facial recognition and one integrated license, as well as synchronously publicize relevant policies and service standards; maintenance, repair, and power transmission arrangements; and information on the energy regulatory hotline, 12398, and the power supply service hotline, 95598, on a regular basis and in a standardized and institutionalized manner. Second, we will step up efforts to promote typical practices to help the high-voltage power supply sector achieve IT application-based, Internet-based and smart development. Third, we will guide all localities to improve the working mechanism which features government-enterprise coordination in electricity supply services, give full play to the leading role of local energy (power) departments and the main role of power supply enterprises, and work together to solve problems and weak links so as to constantly improve residents and businesses' sense of gain and experience in getting electricity. Thank you.

Kyodo News:

On March 21, Chinese President Xi Jinping and Russian President Vladimir Putin signed a joint statement, saying that the two sides will work together to promote research and consultations on a new China-Mongolia-Russia natural gas pipeline project. What is the progress of the negotiation on the Power of Siberia 2 natural gas pipeline project? Does China plan to expand the import of energy from Russia? Thank you.

Zhang Jianhua:

During President Xi Jinping's state visit to Russia in March, the two sides jointly signed the Joint Statement of the People's Republic of China and the Russian Federation on Deepening the Comprehensive Strategic Partnership of Coordination for the New Era. In the statement, the two sides stated that they would work together to promote research and consultations on a new China-Mongolia-Russia natural gas pipeline project. As energy cooperation is an important cornerstone of pragmatic cooperation between the two countries, both sides will build a closer energy partnership, support enterprises from both sides in promoting energy cooperation projects, maintain the stability of industrial chains and supply chains of energy products, and jointly make contributions to the long-term, sound, and stable development of the global energy market. At present, enterprises from both sides are carrying out exchanges and consultations regarding the new natural gas pipeline project. China will continue to support enterprises to conduct research and consultations in accordance with commercial principles. Thank you. 

ThePaper.cn:

Over the past two years, there has been a regional energy supply imbalance in our country. As summer is around the corner, what are the work arrangements to ensure energy supplies in the summer peak consumption season? Thank you.

Liang Changxin:

Thank you for your question. The NEA has faithfully implemented the important arrangements for energy security and power supply made by the CPC Central Committee and the State Council and worked together with local departments and enterprises to ensure power supplies. During last year especially, we have effectively dealt with the challenges brought by high temperatures, drought disasters, and extreme water scarcity during the summer months. The country's maximum power load is expected to exceed 1.36 billion kilowatts this year, a substantial growth compared to last year. According to our research and judgment, power supplies across the country can be well ensured in general, though certain provinces may encounter a shortage of power during peak hours. We will strengthen coordination and make every effort to ensure the work relating to the following five aspects is done well.

First, we will lay more focus on monitoring, analysis, and early warning systems. We will intensify efforts to monitor power supply situation on a regular basis. During the summer peak consumption season, we will ensure power supply in line with the principle of "one policy for one province." We will also closely monitor water supplies and demand conditions in certain provinces like Yunnan and Guizhou, fully take into consideration the uncertainty of water supply during the flood season, and be well prepared for power supply work in the summer peak consumption season in advance.

Second, we will intensify the construction and production of supporting power supply sources and transmission channels. In accordance with the principle of "measured progress while allowing for flexibility," we will see that various power supply sources are operational before peak summer demand to ensure a stable supply. Among these, the supporting power supply will be no less than 17 million kilowatts. We will continuously optimize the regional main grid structure and enhance emergency response capabilities. 

Third, we need to ensure an adequate supply of thermal coal. We will focus on ensuring the stable quantity, quality and price of thermal coal supply. We will urge and guide local governments to speed up the construction of coal mines, promote the swift commencement of approved projects, and optimize the schedule of coal mines under construction to put them into production as quickly as possible. We will also urge provinces across the country to closely monitor the quantity and performance of long-term thermal coal supply agreements and ensure effective implementation and coordination through diligent supervision.

Fourth, we will make every effort to ensure the stability of power generation units. We will urge power generation enterprises to maintain a stable supply of thermal coal and gas, sign high-quality medium- and long-term agreements on thermal coal and gas, and strengthen performance supervision. We will also urge power generation enterprises to enhance both production and equipment management, and resolutely follow dispatching instructions to ensure that electricity generation units perform well and stably.

Fifth, we need to do a good job managing the load scientifically. We will urge local authorities to guide the public in supporting, understanding, and participating in demand-side initiatives. This will further enhance demand-side response capabilities, and effectively alleviate the pressure during peak hours. We also urge local authorities to further optimize plans for orderly electricity usage and refine their implementation. Thank you.

Zhonghongwang:

The report to the 20th CPC National Congress proposed that, based on our resource endowment, we should adhere to the principle of establishing new systems before abolishing old ones, and implement peak carbon emissions actions in a planned and step-by-step manner. What achievements has the energy sector made in establishing new systems? What are the next steps in promoting the green transformation of energy, and what other essential work needs to be done? Thank you.

Li Chuangjun:

Thank you for the question. Energy is a critical sector for achieving peak carbon emissions and carbon neutrality. To implement major policy decisions and plans of the Party Central Committee and the State Council, we always take stock of China's national conditions and reality and adhere to the principle of establishing the new before abolishing the old. Positive results have been made in promoting the green and low-carbon transformation of the energy sector, providing strong support to advancing towards the "dual carbon" goals in a proactive and steady manner.

First, outstanding achievements have been made in green development. China has installed more than 100 million kilowatts of wind and light energy for three consecutive years, and renewable energy installations exceeded 1.2 billion kilowatts at the end of last year. Non-fossil energy sources account for nearly half of the installed capacity. More than 90% of coal power units have achieved ultra-low emissions, with pollutant emissions on par with gas and electricity. Over the past three years, coal consumption has decreased by 1.5 percentage points while non-fossil energy consumption has increased by 2.2 percentage points. Additionally, the number of charging facilities has increased by 3.3 times.

Second, green transformation has gained momentum. New energy technology innovation has accelerated energy transformation. Advanced technologies and equipment, such as high-efficiency photovoltaic power generation and high-capacity wind power have remained at a world-leading level. Significant breakthroughs have been achieved in independent third-generation nuclear power, large-scale energy storage and many other major scientific and technological innovations.

Third, policy support has been strengthened. Implementation plans for peak carbon emissions in the energy, coal, and oil sectors have been issued and implemented. Moreover, the market, legal and standard systems for promoting energy transition have been further improved.

Going forward, we will focus on the following four aspects as we advance green, low-carbon energy transition. First, we will continue to increase the supply of non-fossil energy and accelerate the adjustment and optimization of the energy mix. We will raise the proportion of non-fossil energy consumption by about 1 percentage point per year through 2030. Second, we will work hard to reduce the carbon footprint of the energy industry and advance our efforts to convert the power source of energy production equipment to electricity, gradually phase out outdated production capacities in an orderly manner. We will also promote the integrated development of coal mines, oil and gas fields, and new energy and continue to improve the level of energy conservation and carbon reduction in energy production. Third, we will actively push forward clean and low-carbon transformation of end-use energy and further shift to electricity as the energy source in industrial, construction, transportation, and other sectors. By 2025, we will raise the share of electricity consumption in end-use energy to about 30%. Fourth, we will step up institutional support for green and low-carbon technology innovation and transformation, increase efforts to seek breakthroughs in low-carbon, zero-carbon, and carbon-negative technologies, and constantly improve the institutional mechanisms and policy systems for energy transition. Thank you.

China Mining newspaper:

The report to the 20th National Congress of the Communist Party of China proposed to speed up the planning and development of a system for new energy sources. In recent years, we have driven deeper in pursuing the energy transition. What kinds of foundations have been laid for developing such a system, and what are the next goals and tasks in this regard? Thank you.

Zhang Jianhua:

The report to the 20th CPC National Congress pointed out that "we will thoroughly advance the energy revolution, speed up the planning and development of a system for new energy sources, and ensure energy security." This is the new deployment and requirements of the CPC Central Committee for the high-quality development of the energy sector on the new journey in the new era. Over the last 10 years in the new era, a series of breakthroughs have been made in energy development under the guidance of the new energy security strategy, laying a solid foundation for the planning and development of a system for new energy sources. The green and low-carbon energy transition stands at a new starting point. The installed capacity of non-fossil energy power generation has increased by 2.8 times over the past 10 years, reaching 1.27 billion kilowatts, accounting for 49.5% of the total installed capacity, and the proportion of non-fossil energy consumption has increased by 7.8 percentage points, reaching 17.5%. Energy security has reached a new level. The diversified energy supply system consisting of coal, oil, natural gas, nuclear, and renewable energy has been constantly improved. The total energy production has increased by 33% over the past 10 years, effectively guaranteeing the overall stability of energy supply and demand as well as energy prices, thereafter guaranteeing an annual economic growth rate of more than 6%. Innovation and development have embarked on a new journey. We have built up our strengths in global competition for the clean energy industry. The key components of photovoltaic and wind power account for 70% of the global market share. The R&D and application of new technologies such as high-efficiency photovoltaic power generation, large-capacity wind power, Hualong One nuclear technology, and new energy storage are being accelerated. New forms and models of energy development are constantly emerging.

To thoroughly implement the decisions and deployments of the CPC Central Committee and the State Council to speed up the planning and development of a system for new energy sources, we will push forward the energy revolution and promote energy system reforms to present the "three news," that is, a new energy structure, a new industrial system, and new energy supply and use models. First, we will promote the green transformation of energy production and consumption and accelerate the transition of main energy sources from fossil fuels to non-fossil energy. Second, we will build up a modern energy industry system, intensify efforts to achieve major scientific and technological breakthroughs in pioneering and strategic research, actively advance the construction of the new power system, and push forward the clean, low-carbon, and efficient use of fossil fuels. Third, we will ensure a resilient energy industrial and supply chain, constantly bolster our capabilities for energy production and supply as well as reserve adjustment. We will pay equal attention to cross-regional transmission and balanced regional production, and promote the transformation of energy supply and use models to adopt integrated energy development and strengthen the integration of power source, grid, load and storage. Thank you.

The Poster News APP: 

At the beginning of last year, the NDRC and the NEA issued guidelines on accelerating the building of a unified national power market system. What progress has been made in the past year? What are the main focus points moving forward? Thank you. 

Liang Changxin:

Thank you for your questions. Over the past year, steady and orderly progress has been made in building the power market. The proportion of market-based electricity transactions has been further increased, and the market has been playing a more prominent role in the optimal allocation of resources. First, a multi-level power market system has been improved. Provincial-level (autonomous region-level and municipal-level) market-oriented trading has been deepening, and inter-provincial and cross-regional market-oriented trading has been making steady progress. Medium and long-term inter-provincial transactions are running on a regular basis, and inter-provincial long-period spot transactions are in trial operation. In addition, the southern regional power market has carried out trial operations for coordinating power transfers. In 2022, the proportion of market-based electricity transactions reached 60% of the total power consumption. Second, the market-oriented power trading mechanism has been improved. Medium and long-term and ancillary services markets have achieved full coverage. Six pilot areas for spot transactions, including Shanxi, have entered a long-periodic uninterrupted power settlement pilot operation. Over 600,000 business entities have registered in power trading institutions, and coal power, gas power, nuclear power, and renewable energy power generation systems now participate in the market in an orderly manner. The market mechanism has played an important role in optimizing the allocation of resources, promoting the capacity of absorbing renewable energy power, and ensuring power supply.

In the next step, we will speed up building a unified national power market system so as to adapt to the new energy system and accelerate the building of the new power system. First, we need to improve the multi-level unified power market system, steadily promote the construction of provincial-level (autonomous region-level and municipal-level) and regional power markets, let the inter-provincial and cross-regional transactions be more market-based, and enhance the link between the markets. Second, we should synergize different types of power trading, continue to improve the medium and long-term market and ancillary service market, and actively yet prudently promote the construction of the spot market. Third, we need to help diversify business entities and improve the relevant mechanisms for new energy and new business entities to participate in the power market. Thanks.

The Beijing News:

After years of development, China has become the world's largest producer and consumer of renewable energy. What are the major challenges that we face in this regard, and how will we deal with them? Thanks.

Li Chuangjun:

Thank you for your questions. In recent years, the energy sector has thoroughly implemented the new energy security strategy proposed by General Secretary Xi Jinping, namely, launching a revolution in energy supply, consumption, technology and market, and increasing international cooperation in all sectors. We have been committed to achieving peak carbon emission and neutrality targets as well as coordinating development and security and vigorously promoting the transition to green and low-carbon energy. China's development of renewable energy has achieved new breakthroughs and entered a new stage of large-scale, high-quality, and leapfrog development. Currently, the main challenges that we face regarding the development of renewable energy sources are as follows:

First, in the aspect of absorbing electricity into power grids, with the rapid development of the new energy sector, the traditional power system can no longer meet the requirements of the large-scale and high-proportion development of new energy in terms of planning, construction, dispatching, and operation. Some places see pressure from absorbing electricity generated by new energy sources into power grids. 

Second, in terms of ensuring factors of production, the development of the new energy industry requires a huge amount of land resources. To realize the large-scale development of renewable energy, we need to strengthen policy cohesion and coordination with relevant departments in areas such as land and sea use, as well as environmental protection.

Third, in terms of the consumption and utilization of renewable energy, in order to actively adapt to the new requirement of transitioning from assessing the total amount and intensity of energy consumption to assessing the total amount and intensity of carbon emissions, we need to further guide all sectors of society to proactively consume and utilize renewable energy.

In response to these challenges, we will fully implement the guiding principles of the 20th CPC National Congress, coordinate development and security, and expedite the planning and building of a new energy system, focusing on the following three aspects. First, we will accelerate the construction of new power systems. We will make coordinated efforts to ensure the safe and stable operation of power systems, the reliable supply of electricity, and absorb electricity generated from renewable energy sources into power grids. We will comprehensively improve the adjustment capacity and flexibility of power systems and ensure that new energy resources can generate power, provide electricity, and be used effectively. Second, we will coordinate energy security and food security. We will step up research on policies related to land and sea use for compound new energy projects. We will boost the development of compound new energy projects and the efficient and economical use of land, ensuring the implementation of major projects in this regard. Third, we will work to develop green and low-carbon ways of working and living. We will improve the system concerning green power certificates and move faster to issue them for all power generated from renewable energy. We will introduce policies to promote the consumption of power generated from renewable energy. We will also specify the authority, versatility, uniqueness, and dominant role of green power certificates, expand the scope of their issuance and trading, and work to promote their full coverage. We will foster an atmosphere in all sectors of society to use electricity generated from renewable energy, encourage all energy-consuming units to proactively assume their social responsibility in using such electricity, and promote the green and low-carbon transformation and high-quality development of both the economy and society.

Southern Metropolis Daily:

The CPC Central Committee and the State Council have issued a plan outlining the overall framework for the country's digital development. The document emphasizes support for the in-depth integration of digital technology with the real economy, as well as the accelerating innovative application of digital technology in areas such as agriculture, manufacturing, finance, education, medical services, transportation and energy. What are the goals, tasks and measures for the integrated development of digital technology and the energy sector?

Liu Deshun:

Thank you for your question. Energy serves as a fundamental support for socioeconomic development. In the context of accelerated digital technology innovation and its increasing integration into all fields and stages of socioeconomic progress, the integrated development of the energy sector and digital technology is a key growth driver for upgrading the industrial base and modernizing the industrial chains of China's energy sector in the new era. The initiative holds great significance for enhancing the sector's core competitiveness, supporting its high-quality development, and working actively and prudently toward the goals of reaching peak carbon emissions and carbon neutrality. The 14th Five-Year Plan and the period ahead present an important opportunity to accelerate the integration of digital technology and the energy sector. However, generally speaking, China's energy sector is still in the early stages of digital and smart transformation. There is an urgent need to further strengthen coordination and guidance for industrial transformation and development.

In order to implement the plan for the overall layout of China's digital development that you mentioned, and accelerate the innovative application of digital technology in the energy sector, the NEA recently issued the Opinions on Accelerating the Promotion of Digital and Smart Technologies in the Energy Sector. The goals are to promote the adoption of digital technology in energy production, transportation, storage, sales and use, build a digital and intelligent innovative application system covering all aspects of the energy sector, and speed up the transformation of energy system operation and management model toward greater standardization, digitalization and intelligence. Efforts will be made to increase the proportion of new energy within the energy system and enhance total factor productivity, realize qualitative, efficient and dynamic changes in energy development, improve the quality and efficiency of the energy sector, and curb the total amount and intensity of carbon emissions. Based on the principles of "demand-oriented, digital empowerment, collaborative and efficient, and integrated innovation," the opinions proposed multiple measures from such aspects as accelerating industry transformation and upgrading, promoting application pilots and demonstrations, advancing breakthroughs in generic technologies and improving the support system, as well as strengthening organizational support efforts. These measures are centered around diverse application scenarios, such as smart power plants, smart grids, smart coal mines, smart oil and gas fields, and comprehensive energy services, in order to promote the engineering and industrialization of innovation achievements and cultivate advantages in the integrated development of digital technology and the energy industry from all aspects. Thank you.

CRNTT:

Since last year, the international energy supply and demand situation has been complex and severe, with energy security becoming a common concern for all. How do you view the energy security situation in China at present and in the future? What further steps will be taken to ensure China's energy security? Thank you.

Zhang Jianhua:

Thank you. In today's world, there are increasing unstable, uncertain and unpredictable factors that are constantly posing challenges to the stability of the global energy supply and industrial chains. Since last year, in the context of strained global energy supply, China has maintained stable energy supply in terms of quantity and price by continuously improving energy supply capacity and quality. As we embark on a new journey of building a modern socialist country in all respects, energy consumption will continue to grow. New energy has not had the capability to fully replace conventional energy sources, fossil fuels will continue to play a role in guaranteeing China's energy security, some energy technologies and equipment still have weakness to overcome, and extreme weather has had an increasingly significant impact on energy supply, bringing multiple pressures to energy security. 

At the 20th CPC National Congress, energy was identified as a key area for national security and capacity building. Important arrangements have been made to promote energy revolution and ensure energy security. Next, we will take specific steps in four areas. First, we will take multiple measures to improve our energy supply capacity, including strengthening the construction of advanced coal production capacity, promoting the exploration and development of oil and gas resources, increasing the supply of clean energy, and advancing the building of energy reserve capacity. Second, we will promote the energy industrial chain to be more self-supporting with risks being better controlled, strengthen the research and development of key technologies, and shore up weak links in the industrial chain. Third, we will promote low-carbon transformation of the energy sector, build a new energy system, speed up the optimization of the energy structure, and work to increase the proportion of non-fossil energy in energy consumption. Fourth, we will strengthen prediction and early warnings for energy security risks and continue to formulate and implement relevant energy security plans, to ensure China's stable energy supply. Thank you.

Xing Huina:

The last two questions, please.

Economic Daily:

This year marks the third year of the implementation of the 14th Five-Year Plan. Can you talk about what progress has been made concerning the plan for energy development during the 14th Five-Year Plan period? Thank you.

Liang Changxin:

Thank you for your question. Since the launch of the 14th Five-Year Plan, under the guidance of the new energy security strategy of promoting reforms in energy consumption, supply, technologies, and systems while strengthening international cooperation on all fronts, smooth progress has been made on the main objectives and indicators of energy planning; great advancement has been made in key tasks; and the construction of major projects has been carried out in an orderly manner. All these have laid a sound foundation for the development of a new energy system. The progress is mainly demonstrated in five aspects. First, the demand for energy with growth beyond expectation has been ensured. During the first two years of the 14th Five-Year Plan period, the growth of energy consumption had been higher than expected, with an annual growth rate of 1.5 times that of the 13th Five-Year Plan period. The foundation for energy security has been strengthened. The overall energy production capacity has developed at a faster pace. The production of standard coal reached 4.9 billion tons in 2022, and primary energy production increased by 14.2% over the last two years. Compared with the energy crisis in Europe, China has maintained overall stability in energy supplies and prices. Second, investment in major energy projects has demonstrated strong growth. The key projects of the 14th Five-Year Plan for energy development have been advanced, and over 50% of the projects in the plan have begun construction. Investment in major energy projects nationwide totaled over 4 trillion yuan in the past two years, with a growth rate of 12.2 percentage points higher than that of the investment in infrastructure nationwide during the same period. All of these factors have played a leading role in expanding domestic demand, stabilizing investment, promoting growth, and ensuring safety. Third, notable achievements have been made in expanding green development and cutting carbon emissions in energy development. Since the launch of the 14th Five-Year Plan, new energy development has been further accelerated. The newly installed wind and photovoltaic power capacities have surpassed 100 million kW for three consecutive years. The annual output of electricity generated by new energy is over 1 trillion kWh, with an increase of over 60% over the past two years. Non-fossil energy accounts for nearly 40% of the increase in energy consumption, with equivalent reductions in carbon emissions of about 600 million metric tons of carbon dioxide in total. Fourth, high-quality services for energy consumption regarding people's livelihoods have continued to be improved. Clean heating accounts for over 70% of all heating in China's northern region, surpassing the goals outlined in the plan and contributing to over 30% of the improvement in air quality. About 5.6 million charging facilities have been built nationwide, more than three times that of 2020, ensuring the charging needs of over 10 million new energy vehicles. In addition, the full-scale nationwide supply of State ⅥB standard gasoline for motor vehicles has been ensured, with world-leading refined oil quality. Fifth, the growth driver for the innovative development of energy has been further enhanced. The Hualong One demonstration project, a domestically designed third-generation nuclear reactor, has been built and put into operation. The Baihetan hydropower station, with the largest single-unit capacity in the world, has been built and put into full operation. The research and application of a group of new energy technologies, including large-scale energy storage and hydrogen power, have made new progress. The development of the national unified power market system has been accelerated. In 2022, the proportion of market-based electricity transactions in total electricity consumption surpassed 60%, 20 percentage points higher than that of 2020. Thank you.

China Daily:

This year marks the 10th anniversary of the proposal of the BRI. Quality cooperation projects in the field of energy have brought new opportunities to countries along the route to achieve common prosperity. In the future, the BRI will be confronted with new international and domestic environments. What will the NEA do in this new environment to keep advancing the achievements of energy access, win-win outcomes, and mutual benefits? Thank you.

Zhang Jianhua:

Thank you for your question. Energy is a key area for Belt and Road cooperation. Over the past 10 years since the proposal of the BRI, under the strong leadership of the CPC Central Committee and the State Council, international energy cooperation has yielded fruitful outcomes. A batch of clean, efficient, and quality energy cooperation projects have been launched. The mechanism for multilateral and bilateral energy cooperation has constantly improved, and exchanges in energy policies and technologies have become more frequent. All these have actively contributed to the sustainable energy development of Belt and Road partner countries and safeguarding global energy safety and stability.

Today, our world, our times, and history are changing in ways like never before. Energy cooperation under the BRI also faces many difficulties and challenges. We will have a full and accurate study and grasp of the guiding principles of the 20th CPC National Congress and thoroughly implement the guiding principles of General Secretary Xi Jinping's major expositions on the joint pursuit of the BRI and the promotion of energy cooperation. With the goal of high-standard, sustainable, and people-centered development, we will continue to open up new prospects of international energy cooperation and create new opportunities for the world with new advances in China's development.

First, we will promote high-quality green energy cooperation projects. We will strongly support the green and low-carbon development of energy in developing countries and deeply engage in the global energy transition and transformation. We will fully consider the green energy development needs of Belt and Road countries, continue to expand the coordination of green energy strategies, and encourage enterprises to go overseas to launch green energy cooperation. We will adopt trade, project contracting, investment, and technology cooperation in accordance with local conditions to launch cooperation among three or more markets. We will promote the construction of a batch of green energy best-practice projects that will produce sufficient financial returns and serve as illustrious examples in order to help realize the vision of sustainable energy for everyone.

Moreover, we will actively participate in cooperation on global energy governance. We will uphold the principles of extensive consultation, joint contribution, and shared benefits and jointly build the Belt and Road energy partnership. By means of flagship activities such as the Belt and Road Energy Ministerial Conference and the Belt and Road Energy Partnership Forum, we will advance energy policy exchanges and project matching to promote mutually beneficial energy cooperation. We will strengthen regional cooperation and work to develop and make good use of energy cooperation platforms between China and the Arab League, the African Union, Central and Eastern European countries, and APEC countries. We will advance the establishment of the China-ASEAN clean energy cooperation center and promote exchange activities and capacity building in the area of clean energy to promote the common development and prosperity of energy in all countries. Thank you.

Xing Huina:

Today's briefing is hereby concluded. Thank you to all speakers and friends from the media. See you.

Translated and edited by Xu Xiaoxuan, Wang Wei, Zhang Rui, Zhou Jing, Yang Xi, Qin Qi, Zhang Junmian, Liu Caiyi, Liu Qiang, Ma Yujia, Huang Shan, Yan Xiaoqing, Liu Sitong, Zhu Bochen, Cui Can, Yuan Fang, Xu Kailin, Wang Yiming, Li Huiru, David Ball, Tom Arnsten, and Jay Birbeck. In case of any discrepancy between the English and Chinese texts, the Chinese version is deemed to prevail.

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Read in Chinese

Speakers:

Mr. Shen Hongbing, deputy director of the National Disease Prevention and Control Administration and director of the Chinese Center for Disease Control and Prevention (China CDC) 

Mr. Tong Yigang, professor and dean of the College of Life Science and Technology at Beijing University of Chemical Technology

Ms. Zhou Lei, researcher at the China CDC

Chairperson:

Ms. Shou Xiaoli, deputy director general of the Press Bureau of the State Council Information Office (SCIO) and spokesperson of the SCIO

Date:

April 8, 2023

Shou Xiaoli:

Ladies and gentlemen, good afternoon. Welcome to this press conference held by the State Council Information Office (SCIO). Today, we have invited Mr. Shen Hongbing, deputy director of the National Disease Prevention and Control Administration and director of the Chinese Center for Disease Control and Prevention (China CDC), to brief you on China's study of the origins of SARS-CoV-2, and to take your questions. Also joining us today are Mr. Tong Yigang, a professor and dean of the College of Life Science and Technology at Beijing University of Chemical Technology; and Ms. Zhou Lei, a researcher at the China CDC.

Now, I'll give the floor to Mr. Shen for a brief introduction.

Shen Hongbing:

Friends from the media, good afternoon. It has been over three years since the outbreak of COVID-19 at the end of 2019. During this period, we have continually made efforts on related origin tracing. The study of the origins of SARS-CoV-2 is a highly specialized issue. The Chinese government and scientists have always upheld a science-based approach and hoped to clarify the origins of the virus. The matter is of crucial significance to preventing similar pandemics from happening again.

Now, I'll brief you on our origin tracing during the past three years from two aspects.

First, since the outbreak of COVID-19, China, as a major country committed to being open, has always upheld a science-based approach on the scientific issue of tracing virus origins. We have been actively communicating and cooperating with the World Health Organization (WHO). In response to the resolution adopted by the 73rd World Health Assembly, we took the lead in inviting the WHO to send international experts twice to conduct joint studies on the origins of SARS-CoV-2 in China. Under the principle of jointly formulating work plans, carrying out analysis and research, writing reports and publishing study results, the first phase of the joint origin tracing studies was accomplished in Wuhan. The report, titled "WHO -convened Global Study of Origins of SARS-CoV-2: China Part," or the "Joint WHO-China Study, " has been fully recognized by participating experts both at home and abroad as well as the WHO.

Throughout the first phase of the joint studies, China provided all the origin-tracing-related information that it had at the time to the joint team of experts and concealed no cases, samples, or test and analysis results. Recently, some officials and experts from the WHO willfully made comments and recklessly rejected the previous results. This totally violates scientific principles, rudely offends and disrespects the scientists around the world that participated in the previous origin tracing, and politicizes the origin tracing efforts. This cannot be tolerated by China's scientific community, nor can this be accepted by its global counterparts.

Second, based on the huge amount of human, material and financial resources invested in the first phase of the joint studies, we did not suspend our origin tracing. We continue to coordinate the resources and to carry out comprehensive scientific investigations in the fields of epidemiology, molecular epidemiology, animal and environment and even laboratory inspections. Chinese scientists have shared related progress and results with the global scientific community by reporting to and communicating with the WHO and its Scientific Advisory Group for the Origins of Novel Pathogens (SAGO ) and publishing papers. Many findings in the research have also further proved the results from the first phase of the joint studies.

These research findings and related data have been published in international and domestic academic journals. As a responsible country and with scientists who have a sense of responsibility, we have always proactively shared these results with scientists around the world. We hope to uphold a science-based and scientist-centered approach, strengthen communication, cooperation and information sharing, and stick to a scientific path when carrying out SARS-CoV-2 origin tracing. Those who instigate and participate in politicizing the origin tracing and use the issue to smear China should not assume that the global scientific community will be deceived by such stunts. We urge those WHO officials and experts to return to a scientific and impartial stance, and not to take the initiative or be forced to become tools for certain countries to politicize the origin tracing efforts.

Joining me today are professor Tong Yigtang and researcher Zhou Lei. They are both experts who participated in the WHO-China joint origin tracing research. They will also brief you on relevant information, and we will take your questions together. Thank you.

Shou Xiaoli:

Thank you, Mr. Shen. The floor is now open for questions. Please identify the media organization you work for before asking your questions.

Global Times:

Some WHO officials believe the Chinese government has not been open and transparent in providing COVID-19-related data, affecting global origin tracing. What are your comments on this? What difficulties have you encountered in origin tracing? Thank you.

Shen Hongbing:

Thank you for your questions. I would like to invite Ms. Zhou to answer your questions.

Zhou Lei:

Thank you for your questions. We have also noticed the situation you mentioned. To be honest, as a Chinese scientist who participated in person in the first phase of the joint origin tracing studies, I was surprised to hear such words. In fact, when we were in Wuhan, we collaborated with both domestic and foreign scientists as part of the joint expert team to conduct origin-tracing together. During this process, Chinese scientists adhered to the principles of being scientific, open, objective and transparent and shared all available data and materials. This included early case information and the case data of over 76,000 individuals who were suspected of having possibly been infected by COVID-19 during the early stages in Wuhan. We shared and conducted an in-depth joint analysis and study of these data and materials, and the results were collectively confirmed by the experts at that time.

In addition, we conducted antibody or nucleic acid testing on over 38,000 poultry and livestock samples and more than 41,000 wild animal samples collected within China's borders from 2018 to 2020, yet no positive results were found. We also conducted origin-tracing investigations on the upstream and downstream supply chains of all animal products at the Huanan Seafood Market during that time and found no evidence suggesting that the virus spread among animals. These results were shared at that time with the international expert team selected by the WHO and were acknowledged by them.

During the first phase of the joint studies of the origins, we followed a scientific and comprehensive approach, considering the possibility of a lab leak when planning our study. To investigate this possibility, while in Wuhan, we organized the joint expert team to conduct field research, investigations and studies at multiple local laboratories and engaged in in-depth exchanges. We also investigated and analyzed all health monitoring materials, as well as possible treatment and clinical materials of staff members and students studying at the labs during that period. Therefore, taking all aspects into consideration, we fully shared our research findings and data without any concealment or reservation during the first phase of the joint origin tracing studies. 

We know that there's a certain degree of difficulty in conducting scientific research, especially virus origin tracing studies. In the past, we have encountered multiple newly emerging infectious diseases, such as HIV (AIDS), for which we only detected and gained some clues and understanding about its origin over a decade after it was first identified. This also applies to Ebola, whose origin has remained unclear since its emergence in the 1970s. It has only been three years since the outbreak of COVID-19, so we still have a long way to go. Origin tracing research results for many diseases have shown that the place where the epidemic first began does not necessarily equal the place of the pandemic's origin. Therefore, we should maintain a scientific approach. More importantly, SARS-CoV-2 origin tracing requires scientists worldwide to collaborate based on a fully objective and scientific attitude.

The WHO is highly important as an authoritative professional organization recognized by the international community and its scientific, rigorous, and impartial nature is beyond question. However, I think the recent denial of research results by certain WHO officials, particularly regarding the results of our first phase of joint studies on origins, may damage the credibility of the WHO. So, this is our perspective of and opinion on the overall studies of the origins. Thank you.

ITV News:

I want to just follow up on that question about the WHO claim. You seem to suggest that you have been open and transparent throughout, so as you mentioned, do you think it's purely political? Are these accusations [political]? And finally, I'd like to ask you about the recent study that you have produced regarding raccoon dogs suggesting that they could have been an intermediate host potentially for the virus. Thank you.

Tong Yigang:

I don't think the accusation is scientifically grounded. As Prof. Zhou just mentioned, the Chinese expert team worked together with the expert team sent by the WHO for about a month during the first phase of joint research. They engaged in numerous scientific discussions and reached many conclusions, which I believe are all science-based and having been widely accepted after been published online. Regarding the recent data that identified the raccoon dog as a possible source of the virus, there is currently insufficient evidence to confirm this. Many people are eager to identify how the virus was transmitted and the relevant proof. We share this desire and are working to uncover the virus's origin. To do this, Chinese scientists, as well as researchers worldwide, are involved in this effort. However, the data presented in this article is not enough and not even close. It is a bit like when we constantly imagine how an event happen and speculate about, as the Chinese fable that states that if someone suspects his neighbor of stealing his axe, all the neighbor's behaviors appear suspicious to him. However, if the lost axe turns out to be in his own barn, the neighbor will no longer look like an axe thief. Some people always want to find evidence and will associate anything seemingly related to the case as correlated, thinking that raccoon dogs are the origin. An article published earlier said that some animal samples were found in environmental samples in the early stage of the COVID-19 pandemic. But these samples were mostly human samples and those of chickens, pigs, dogs, cats and various types of poultry. In fact, these animal samples significantly outnumbered those of raccoon dogs. From this perspective, there is not enough evidence. Moreover, many samples were tested at the Huanan Seafood Market, including hundreds of animal samples, but no animals carrying the virus were found. Therefore, it is not enough merely searching for animal samples from the environment and basing conclusions on that. Furthermore, the viral genetic sequences we found in the environmental samples were almost identical to those collected from early patients, suggesting that the samples collected from the environment likely originated from humans rather than animals. There is plenty of evidence of raccoon dog genetic sequences present in environmental samples that tested negative for SARS-CoV-2, and they even outnumbered those samples that tested positive for the virus. The negative samples refer to samples that are free of the target virus. As a result, it's difficult to determine whether the virus originated from raccoon dogs. Besides, even if raccoon dogs were infected, many people at the Huanan Seafood Market were also infected, and therefore, it's possible that people contaminated the environment or the virus spread from people to raccoon dogs. It's a possibility that we can't rule out, even if raccoon dogs tested positive. Therefore, I don't think it's adequate or scientific to draw such a conclusion based on this small amount of data. Thank you. 

China News Service: 

Foreign media outlets have reported that the author team from the China CDC deleted data that had been uploaded to the Global Initiative in Sharing Avian Influenza Data (GISAID) database when submitting their article on early research data on the Huanan Seafood Market. Is this true? What was the process of submitting the article? Thank you. 

Shen Hongbing:

Thank you for your questions. I'll answer them. As far as I know, the research team from China CDC submitted a preliminary draft paper to Nature in February 2022. During the submission and revision process, experts from China CDC and other organizations uploaded the original data related to the paper to the GISAID database following international practices for scientific paper publication. The data was intended only for access by the journal's reviewers, and an agreement was made with the journal and GISAID that the data would not be publicly released until after the article's publication. The data and access links have been all available and have not deleted. On March 11, 2023, the author team found that the data uploaded to the GISAID platform had been prematurely released by GISAID staff before the article's publication and without the author team's knowledge. The research team immediately called the GISAID platform to inquire about the situation, and the staff said that the data release was caused by a "misoperation" by their staff. The platform subsequently closed sharing access, but the data is still available on the platform. Our team and platform have not deleted any data, and the data access link for the peer review process has always been available. The author team uploaded the research data following international practices. We hope that GISAID will clarify this to the media and the WHO to restore the truth of the matter.

Additionally, the latest version of the paper was published online by Nature on April 5, and all the original data has also been simultaneously released in four databases at home and abroad. Thank you. 

CCTV:

This paper has indeed garnered much attention. What are the main findings of the China CDC's paper on the early research data on the Huanan Seafood Market, and are any new findings on origins tracing included? Thank you.

Tong Yigang:

Thank you for your questions. This paper describes how researchers from the China CDC conducted testing for SARS-CoV-2 and metagenomic sequencing on over 1,300 environmental samples and frozen animal samples collected from the Huanan Seafood Market between January and March 2020. The results showed that 400-plus animal samples tested negative, while 73 of the 900-plus environmental samples tested positive. During the testing process, they also isolated SARS-CoV-2 strains from three environmental samples and, after genome sequencing, found that the sequences of the viruses were almost 100% identical to that of infected cases at that time. This suggests that those viruses were from humans. In the analysis, some information on the hosts in environmental samples showed that the hosts were mainly humans and that there were also genes from pigs, cattle, chickens, ducks, cold chain products, and even gene fragments from mice and cats. These findings suggest that the SARS-CoV-2 detected was highly likely to have been introduced by humans. The data further supports the findings of the WHO-China joint study in the first phase. Thank you.

Bloomberg:

What do Chinese scientists and experts think is the most likely origin of SARS-CoV-2? Thank you.

Zhou Lei:

Thank you for your question. We have already reached a conclusion on the origins of SARS-CoV-2 through the joint study in the first phase, which was fully presented in the report released by the WHO-China Joint Mission at that time. You are welcome to read it carefully, as we clearly stated our assessment of several hypotheses regarding the origins of SARS-CoV-2. First, we evaluated the potential sources of the outbreak in the report, including humans, animals, cross-species transmission, and lab leak scenarios. We had an epidemiological group, an animal origin tracing team, and a molecular origins tracing team within our joint mission, all conducting studies in Wuhan from various angles. As a result, we believe that the comprehensive assessment-based conclusions we reached at that time are scientifically sound and credible. To reiterate, our conclusion back then was: direct zoonotic transmission to humans (spillover) is "possible to likely," introduction through an intermediate host is " likely to very likely," introduction through cold/ food chain products is "possible," and introduction through a laboratory incident is "extremely unlikely."

Following the first phase of joint studies on the origins of SARS-CoV-2 in Wuhan, our work did not stop. We continued many studies based on the work plan and recommendations for subsequent stages formulated in Wuhan at that time. Various additional results have reinforced the findings of our first phase of study in Wuhan. In response to your question, our assessment remains unchanged and can be looked up in the study report jointly released back then. Thank you.

Channel NewsAsia:

Referring to a recent editorial by the WHO, a question: why data and viral samples that were collected in Wuhan in January 2020 were not shared immediately but waited until more than three years later, now, to be made public. Also, calling the lack of data disclosure "simply inexcusable?" So what's the reason for China not releasing this data earlier, and what's your response to this? Thank you.

Shen Hongbing:

Thank you very much for your questions; I will take them. As Ms. Zhou mentioned just now, WHO-China Joint Mission conducted joint origins tracing from January to February 2021, including research on the Huanan Seafood Market. Its epidemiologists visited the market and, based on the metagenomic sequencing results of over 70 PCR-positive environmental samples, provided suggestions for the following phase. Consequently, China CDC scientists conducted a series of follow-up studies based on the suggestions specified in the WHO report on origins tracing. Subsequent analysis revealed that DNA barcodes in environmental samples from the Huanan Seafood Market offer no new clues to SARS-CoV-2 origins. In February 2022, China CDC experts compiled data and DNA barcodes from the market into a scientific paper, submitted it to Nature for peer review, made it public through a preprint platform, and uploaded the original data to GISAID following international practices. The relevant data has now been released simultaneously in four databases, both in China and abroad, and the paper has been officially published in Nature. It is worth noting that it took some time to conduct the studies. Chinese scientists conducted further relevant analysis according to the WHO's suggestions on follow-up studies, and it took some effort to submit the paper. Now the preprint is public, and the data will follow, so there is no deliberate delay in data release. 

After the first phase joint study report was released, Chinese scientists conducted extensive SARS-CoV-2 origins tracing, and their research findings were promptly published. For example, a study, published in Protein & Cell, reports that serological tests of blood donors in Wuhan during the second half of 2019 revealed no COVID-19 infections. A study on the virus spectrum of over 17,000 bats in China, published in National Science Review, finds no sequences related to SARS-CoV-2 or related coronaviruses. We have shared our research findings and data with our international peers. Thank you.

China Daily:

Recently, the media have been highly focused on the sequencing data in the study on the Huanan Seafood Market by researchers from the China CDC. What is your take on this matter from a professional perspective? Thank you.

Tong Yigang:

Currently, no scientific evidence can clearly determine the true origin of the SARS-CoV-2. All animal swab samples mentioned in this paper have tested negative, indicating that no animals at the Huanan Seafood Market were infected. Some environment swabs returned positive, with most of the detected host information from human and some from animals. This also suggests that the cases at the Huanan Seafood Market likely originated from humans rather than animals at the market. Scientists have been working hard to study the origins of the SARS-CoV-2 and have also discovered some coronaviruses in bats that are closer to the SARS-CoV-2 in other countries. However, the exact characteristics of the SARS-CoV-2, how it infects humans, and where it came from still require further research. The media's attention to this matter reflects the public's concern about public health issues. This prompts us, as scientific and technological workers, to provide scientific interpretations of the data from a scientific perspective so that everyone can better understand the data. Thank you.

South China Morning Post:

You just said that blood samples taken before the outbreak of COVID-19 in China have been tested and analyzed. Can you give us more details on that? Thank you.

Zhou Lei:

Thank you for your question. As a matter of fact, we put forward proposals in this regard as early as during the first phase of the joint studies on SARS-CoV-2 origins in Wuhan. China fulfilled its commitment made at that time, and quickly organized a large amount of manpower and material resources, including financial input, to monitor the stored sera of healthy blood donors, which was a huge workload. Let me give you some details. There were 43,850 blood samples involving 30,000 people that needed to be tested. The test results showed that no SARS-CoV-2 antibodies were detected. All of the samples were taken from local blood donors in Wuhan before December 2019. This result clearly confirmed our common findings in the first phase of the joint studies, that is that no cases were found in Wuhan prior to December 2019. As Mr. Shen said just now, we published and shared these results in a timely manner. Thank you.

The Beijing News:

We have noted that some international experts have come up with different research results based on the early research data from the Huanan Seafood Wholesale Market uploaded by the China CDC to the GISAID platform. What do you think is the reason for the differences? Are they out of different analysis methods or because of other reasons? Thank you.

Tong Yigang:

Thank you for your question. You may obtain different results using different methods, software and parameters when analyzing the uploaded data. However, our analysis of DNA barcodes in the data found that the host information of these environmental samples was mostly from people, and human gene abundance was the highest, suggesting that the virus in the seafood market environment likely came from early patients. In addition, analysis of DNA barcodes also revealed the presence of pigs, cows, chickens, ducks and other species at the market before it was closed. Some experts noted the presence of some animal genes in the samples, and suspected that these animals had passed the virus on to people at the market. The data that has been obtained so far shows no signs of the virus infecting animals at the market. Therefore, these speculations are actually unscientific, and the results of our experiments do not support animals at the seafood market being the animal origin of SARS-CoV-2. Moreover, the environmental samples were collected in January 2020, after the emergence of early cases. Therefore, even if there had been infected animals at the seafood market, it is possible that the animals were infected by humans, rather than vice versa. Therefore, we believe that there is no scientific basis for the claims of the so-called animal-to-human transmission at the market. These are just subjective assumptions. Thank you.

CGTN:

Some experts from the WHO think that due to the lack of original data about early cases in China, the report on the first phase of the joint studies met serious criticism. What's your response to this? Thank you. 

Zhou Lei:

Thanks for your question. I also noted this. When we conducted the first phase of the joint studies on SARS-CoV-2 origins, the members of the joint expert group, be it the Chinese scientists or the top international scientists selected by the WHO, all sought to trace the origins with a science-based approach. At that time, we formulated four common principles. Based on those principles, the 28-day research work in Wuhan, tiring though it was, secured remarkable outcomes, including the conclusions we mentioned above. In terms of the early cases, we shared all the materials that we collected at that time, including possible and suspected cases. The Chinese expert group and the international expert group worked together every day during the research, and we presented all the materials and information we gathered, including patient charts and questionnaires. During this process, we took a science-based approach and also abided by the international convention of protecting the respondents' privacy, so we did not shoot videos or take pictures. However, the expert group members shared data, which was studied and analyzed together, and drew joint conclusions. The idea that we hid or did not share information about early cases is simply not true.

The report on the first phase of the joint studies on SARS-CoV-2 origins received wide recognition from the WHO and other international peers. I do not understand why there is doubt now, and I feel sad about this. As I said just now, we invested a great deal of manpower, material, and financial resources into the first phase of the joint research. It can be said that both the Chinese scientists and top international experts from the WHO worked very hard around the clock, generating a joint report of great scientific value. The report should get its due respect rather than meet denial or criticism. Therefore, I suggest that we continue to trace the origins of the virus with a science-based approach and manner and jointly commit ourselves to the next phase of the work without finger-pointing or suspicion. Because this will not help us discover the origins of the SARS-CoV-2. This is our response. Thank you.

Xinhua News Agency:

The expert mentioned just now that the first phase of the joint origin tracing studies concluded that the lab leak hypothesis was "extremely unlikely ." Now the WHO has proposed that various kinds of hypotheses are open to study and need further study. How do you respond to this? In addition, how do you feel about the COVID-19 Origin Act of 2023 of the US being signed into law ? 

Tong Yigang:

Thanks for your questions. During the first phase, the WHO and China each sent more than 10 experts to Wuhan, where they spent nearly a month conducting a joint study. They made a science-based judgment that the lab leak hypothesis was "extremely unlikely." This conclusion was reached after scientists from both sides carried out extensive investigations and studies, including visiting relevant labs in Wuhan and conducting in-depth interviews with relevant persons. As for the series of hypotheses on the origins of the coronavirus, the joint group gave assessments ranging from "extremely unlikely" to "very likely," which were based on objective facts as well as rigorous and science-based judgments. We should conduct further study on the basis of respecting the results of the first phase of the joint research to improve the efficiency of the origin tracing. If we do not accept or recognize the study outcomes of the first phase and repeat the work done during that phase, it will be a huge waste of resources and even lead to the subsequent work heading in the wrong direction. This will also call into question the value of subsequent work in the future. 

As for the US' COVID-19 Origin Act of 2023, we should underline that SARS-CoV-2 origin tracing studies is a matter of science, and we should look to scientific facts for answers rather than politicize the matter. We also strongly oppose slandering, dramatizing, and other unscientific and irrational actions. Thank you.

Kyodo News:

Regarding the investigation and research into the origins of SARS-CoV-2, what are China's plans for future cooperation with the international community? Are there any specific arrangements or plans in place for international cooperation? Thank you.

Zhou Lei:

Thank you for your questions. That is actually our aspiration as well. Just now, I have repeatedly mentioned that tracing the origins of SARS-CoV-2 is not an issue for just one country and cannot be accomplished by one country alone. It necessarily requires the joint efforts of the global scientific community. Therefore, it is imperative that the international community, especially scientists, work together to carry out origin tracing. That is what must be done and what we have consistently advocated. We have cooperated with the WHO in a transparent, objective, science-based, and open manner. Additionally, we have invited international experts many times. For example, since 2020, we have invited international experts to China to study the origins of SARS-CoV-2 at least twice. I believe this approach will remain unchanged in the future. That is for sure.

Just now, my colleagues have repeatedly mentioned that during the first phase of our joint studies, we collaborated with 10 international peers and top experts to carry out research together. We developed a detailed joint research report and released it together, which in itself demonstrates our attitude and our research achievements. After that, we didn't stop our origin tracing research; our expectations and efforts never ceased. We shared with our international peers a great number of research results and data from our later studies. We published many papers and shared genetic sequences of coronaviruses, our data and information on multiple databases. In addition, we supported the WHO's decision to conduct joint global origin tracing and sent experts to collect more data and materials. We have continuously done all the work that we can do. In fact, we hope that global origin tracing can truly become an international effort. We have often called for expanding the scope of origin tracing research to cover all possible countries and regions, rather than always sensationalizing and focusing on Wuhan. We have done a lot of work in this regard. I have repeatedly reiterated that China's attitude remains unchanged: Origin tracing research should be an international endeavor. We also hope that the WHO, as an authoritative professional international institution, can truly organize global origin tracing and unite all elites from the international scientific community with a science-based, rigorous, and impartial attitude. In doing so, we can discover a convincing answer to the origins of SARS-CoV-2 in the future. Thank you.

Shou Xiaoli:

The last question, please.

Phoenix TV:

We have noticed that the WHO recently published opinion articles expressing their hope that China can share any data related to the origins of SARS-CoV-2 as soon as possible. How does China plan to share this data in cooperation with the WHO, and are there any follow-up plans? Thank you.

Zhou Lei: 

Thank you very much for your questions. Actually, we have also noticed the opinion articles you mentioned and are paying attention to this issue. In fact, we have consistently maintained close cooperation and communication with the WHO. For example, during the first phase of the joint origin tracing studies, we responded to the appeal of the World Health Assembly and invited the WHO, including the international experts they selected, to come to China and Wuhan to carry out joint origin tracing, which itself is a giant step we have taken. In addition, after completing the first phase of the joint studies, as our experts mentioned just now, we immediately shared our research results with the SAGO, an expert team under the WHO, and engaged in in-depth and comprehensive exchanges with them. We shared the information as early as possible. Moreover, we published papers presenting all our research results in many science journals to share with our international peers. I believe that we will continue to do things like that in the future. Since 2020, we, with WHO experts and joint origin tracing researchers, have not only worked together in Wuhan but also held many video conferences. During the pandemic, as we could not have in-person meetings, we communicated via emails and video conferences. Our researcher Yang Yungui, who participated in the first phase of the joint studies, also joined the SAGO later. From the perspective of Chinese scientists, we are very open and transparent, adhering to a science-based approach. Our government is very supportive and has invested a great deal of personnel, materials, and funds in conducting origin tracing research and collecting large amounts of data. Without this support, it would not be possible for us to get such good results to share with our international peers. The science journals in which we published our papers are very influential, which is helpful for international origin tracing efforts. I believe that we will continue to maintain close cooperation and communication with the WHO, our international peers, and scientists who have consistently taken a science-based approach for the origin tracing. We will continue to promptly share our latest research results and data on origin tracing. Thank you.

Shou Xiaoli:

Thank you to all the speakers and friends from the media. Today's briefing is now concluded. See you.

Translated and edited by Zhu Bochen, Wang Wei, Zhou Jing, Huang Shan, Gong Yingchun, Li Huiru, Zhang Jiaqi, Liu Sitong, Zhang Rui, Zhang Junmian, Duan Yaying, Xu Xiaoxuan, Xu Kailin, David Ball, Tom Arnsten, and Jay Birbeck. In case of any discrepancy between the English and Chinese texts, the Chinese version is deemed to prevail.

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Read in Chinese

Speakers:

Mr. Wang Jun, commissioner of the State Taxation Administration (STA)

Mr. Wang Daoshu, deputy commissioner of the STA

Mr. Luo Tianshu, chief accountant of the STA

Mr. Cai Zili, chief auditor of the STA

Chairperson:

Ms. Xing Huina, deputy director general of the Press Bureau of the State Council Information Office (SCIO) and spokesperson of the SCIO

Date:

April 6, 2023

Xing Huina:

Ladies and gentlemen, good morning. Welcome to this press conference held by the State Council Information Office (SCIO). This is the 12th briefing in the series "Embarking on the New Journey — A Government Perspective." Today, we have invited Mr. Wang Jun, commissioner of the State Taxation Administration (STA), to brief you on better harnessing taxation to deliver high-quality economic and social development, and to take your questions. Also joining us today are Mr. Wang Daoshu, deputy commissioner of the STA; Mr. Luo Tianshu, chief accountant of the STA; and Mr. Cai Zili, chief auditor of the STA.

Now, I'll give the floor to Mr. Wang Jun for a brief introduction.

Wang Jun:

Friends from the media, ladies and gentlemen, good morning. It is my pleasure to meet you at this press conference and respond to your concerns. For years, journalist friends and people from all sectors of society have given their full support and understanding to the taxation work and tax authorities. On behalf of the STA and my three colleagues here today, I would like to take this opportunity to express my heartfelt gratitude to you all. Thank you.

Since this year, faced with a complex global environment and challenging domestic reform and development tasks, the Central Committee of the Communist Party of China (CPC) with Comrade Xi Jinping at its core has united and led the Chinese people of all ethnic groups, efficiently balanced both the international and domestic situations, and strived to achieve an overall improvement in economic performance. As a result, China's economy has got off to a relatively rosy start. Taxation is a barometer of the economy. Business production is followed by sales, and sales cannot be completed without issuing invoices. By taking advantage of value-added tax (VAT) invoices and other taxation-related big data, which are immediate, broad-based and detailed, the tax authorities can depict and compare the macroeconomic trends in a timely, objective and relatively comprehensive manner. This graph shows the changes in the sales revenue of enterprises across the country from January 2022 to April 5, 2023.

As shown by the curved line on the graph, in the past 15 months, the growth rate of sales revenue of enterprises across the country makes two V shapes, which together form a W shape. The first V-shaped curve started from the high growth rate of 6.6% in the January-February period last year. Then, the growth rate began to drop month by month to a low of -7.4% in April, and returned to a relatively high level of 7.5% in June. The second V-shaped curve started last July, slowly fluctuated and declined to a low of -3.1% in December, which was also the second-lowest growth rate last year. With the swift and smooth transition of the COVID-19 response measures and macroeconomic policies taking effect, the growth rate of business sales revenue has been picking up this year. The growth rate in the first quarter rose by 4.7% year on year and increased by 6.2 percentage points compared with the fourth quarter of last year. The growth rate also increased month by month, and the figure achieved a year-on-year increase of 12.8% this March.

Taxation-related big data also shows the growing confidence of businesses in production and operation going forward. In March, the value of business purchases increased 14.1% year on year, which was 12.8 percentage points higher than in January-February. The figure from April 1-5 saw a year-on-year increase of 23.8%. More purchases will translate into more sales. Given the low level last April and the continuing effects of the series of macroeconomic policies this year, we are certain that business sales revenue in April will see an even higher year-on-year increase than March. Business sales revenue from April 1-5 also reached a high level, up 21.2% year on year. In short, during the first year of the implementation of the guiding principles of the 20th CPC National Congress, China's economy has seen sound growth momentum overall in the first quarter. Such momentum was maintained on a month by month basis, and continues to improve.

The 20th CPC National Congress drew up a grand blueprint for advancing the rejuvenation of the Chinese nation on all fronts through a Chinese path to modernization. Important arrangements were made at the Central Economic Work Conference and the NPC and CPPCC Sessions, and by the new-term State Council for promoting China's economic and social development. All these facts have placed new and higher requirements on tax reform and development. Taxation authorities must further strengthen their political stance and keep in the right direction in their work. We will strive to be a pragmatic doer and a solid contributor to implementing the decisions of the CPC Central Committee and the State Council, also a servant, a publicist, and a close friend of the tax and fee payers. We will give better play to and expand the role of taxation, lay a solid foundation for promoting all taxation-related work from a new starting point, and better serve Chinese modernization through taxation modernization.

First, we will continue to intensify self-improvement efforts to ensure that taxation organs are first political organs. At any time, taxation authorities should take immediate action in accordance with the arrangements made by the CPC Central Committee. We will launch activities under the theme of studying and putting into practice Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era and follow the general principle of "studying the Thought, strengthening Party spirit, prioritizing practice, and making new contributions." By studying profoundly, understanding thoroughly, and doing investigation and research carefully, we will strive to assume responsibilities and do solid work. By doing so, we will constantly break new ground in the self-improvement of the taxation system as a political organ, make new achievements in all taxation-related work, and oversee that taxation officials take new steps to perform their duties.

Second, we will focus on the primary task of serving high-quality development. High-quality development is the top priority in building China into a modern socialist country in all respects and also the primary responsibility of taxation authorities in serving matters of national significance. All taxation-related work should focus on and make a contribution to this priority. We will continue to collect taxes in accordance with laws and regulations and stick to the bottom line of no tax or fee not prescribed by law so as to create a solid financial foundation for achieving high-quality development. We will proactively study and fully implement all preferential tax and fee policies so as to speed up economic growth and unleash market vitality for achieving high-quality development. We will also constantly adopt measures to innovate our services and enhance targeted regulation to ensure that taxation authorities always respond to people's concerns, meet people's needs, and strive for people's aspirations so as to foster a favorable tax and business environment for high-quality development. 

Third, we will deepen reform, promote innovation, perform our duties in a creative way, and improve our efficacy. We will earnestly implement the requirement of the CPC Central Committee to engage in extensive research and fact-finding activities and carry out the arrangements set by the new-term State Council. By switching roles and putting ourselves in others' positions, we will work to understand the realities, take specific steps, and deliver solid outcomes. Focusing on hands-on experience, wholehearted services, solid progress, and effective reforms, we will guide taxation officials to perform their duties and ensure implementation in a creative way and strengthen the role of taxation as the foundation, pillar, and guarantee of the country's governance.

Next, my colleagues and I are happy to answer your questions. Thank you.

Xing Huina:

Now you are welcome to ask questions. Please identify the media outlet you represent before raising your questions. 

CCTV:

Mr. Wang just mentioned that the tax data reflects a better start to China's economic development so far this year. Can you tell us more about that? Thank you.

Wang Jun:

Thank you for your follow-up questions. I understand that you are trying to further understand some of the specifics of the economic operation in the first quarter of this year. Here I will try to use "six gradual upturns" to elaborate.

The first gradual upturn is that economic operations are gradually rebounding. Just now, I have briefly introduced the overall operating situation, which I will now subdivide by industry to provide a more detailed breakdown. In March, 79.7% of the national economy's 473 medium-class industries and 75.8% of its 1,382 small-class industries achieved positive growth, while the proportion in January and February was about 56%. Between April 1-5, the proportion of medium-class and small-class industries that achieved positive growth increased to 86.9% and 82.3%, respectively. I cite this specific example and list these specific numbers to tell you that the proportion right now is close to what it was in 2019 before the epidemic.

The second gradual upturn is that business entities are becoming gradually active. First, the number of new taxpaying business entities is gradually increasing. In the first quarter, their number hit 3.434 million, up 7.2% year on year, 8 percentage points higher compared with the full-year growth of last year. Second, business entities whose production and operation were hard hit by the epidemic are regaining vitality at a faster speed. In March, the number of taxpaying business entities that received invoices and had income declarations increased by 2.08 million and 3.12 million, respectively, compared with February and January.

The third gradual upturn is that industrial production is gradually recovering. In March, industrial enterprises' sales revenue grew 7% year on year, 1.2 percentage points higher compared with annual rate of last year. The year-on-year growth for manufacturers of intelligent consumption equipment and manufacturers of communications equipment reached 36.4% and 12%, respectively. Given the continual decline in the year-on-year growth of PPI, the increase in sales revenue was hard-won. In addition, in March, the amount of money spent on purchasing machinery and equipment by the manufacturing industry increased by 13.5% year on year, 7.1 percentage points higher than the full-year rate of 2022, which reflects the increasing willingness of enterprises to expand production and upgrade equipment.

The fourth gradual upturn is that consumer demand is gradually expanding. In the first quarter, catering and accommodation; culture, sports and entertainment; and residential services, among other contact-based service industries, notably rebounded, registering sales revenue growth of 22.8%, 13.7%, and 9.4% respectively year on year. The growth rates were 22.7, 17.6, and 6.5 percentage points higher compared with the annual growth of last year and exceeded the pre-epidemic 2019 level. Commodity retailing recovered steadily and faster, with sales revenue increasing by 11.6% year on year, 3.4 percentage points higher compared with the whole of last year. It is worth mentioning that housing consumption showed signs of rebounding, and the sales revenue growth of real estate reentered the positive territory in January and February, up 2.3% year on year, 19.5 percentage points higher than the annual growth of 2022. In March, the year-on-year growth further increased to 17.9%.

The fifth gradual upturn is that the innovation momentum is being gradually enhanced. In March, the high-tech industry sales revenue grew 15.6% year on year, 5.7 percentage points higher than the full-year growth of 2022. The growth rates for such high-tech services as services for applying sci-tech advances and information services were relatively faster, up 45.5% and 19.8% year on year, respectively. In March, core industries of the digital economy grew 14.1% year on year, 7.3 percentage points faster than that of last year. Among them, the digital factor-driven industry and digital technology application industry grew faster, up 24.5% and 19.8% year on year, respectively.

The sixth gradual upturn is that green development is getting gradually boosted. In the first quarter, sales revenue of the ecological protection and environmental governance industry increased by 18.1% year on year, while that of power generation based on wind energy, solar energy, and other clean energy increased by 21.8% year on year, both maintaining a high growth rate, significantly faster than the overall national level. In particular, the sales revenue of the new energy vehicle manufacturing industry maintained good growth momentum, rising 35.2% year on year in the first quarter, after an already high year-on-year growth of 111.5% in the first quarter of 2022. 

Of course, while acknowledging that overall economic performance is moving in a positive direction, month by month, and will get better in the next step, we must also be keenly aware that there are still many uncertain and unstable factors at home and abroad. The internal driving force for high-quality development needs to be further strengthened. Although economic development faces various problems and difficulties, we are confident we will meet this year's economic growth target of around 5%. However, we need to work hard. Thank you.

China Daily:

The 20th CPC National Congress proposed insisting on focusing on the real economy in terms of economic development and moving faster to boost China's strength in manufacturing. What has been the effect of preferential tax policies on the development of the manufacturing sector in recent years, and how will tax support help the manufacturing sector become stronger in the future? Thank you.

Cai Zili:

Thank you for your questions. Manufacturing is the foundation of the real economy and the lifeline of the Chinese economy. In recent years, the CPC Central Committee and the State Council have planned and implemented a series of tax refund and fee reduction measures, and the manufacturing sector has been the top priority for support. In particular, a series of major measures to ease the heavy burden of the manufacturing sector has been successfully launched. These measures include lowering the VAT rate in the manufacturing sector and other fields, taking the lead in increasing the tax deduction ratio for manufacturing R&D expenses and making greater efforts to increase VAT credit refunds in manufacturing. These measures have effectively supported the manufacturing sector in reducing operating pressure, enhancing innovation motivation, and unlocking development potential.

Data shows that tax support aimed at improving the manufacturing sector is quite strong. First, the scale of tax and fee reductions is the largest. Since 2018, the manufacturing sector has benefited the most, with a total of more than 3.5 trillion yuan in tax and fee reductions, and tax refunds and fee deferrals, meaning the manufacturing sector has enjoyed the most tax and fee cuts. Second, the tax burden has dropped the most. Tax and fee reduction policies have significantly reduced the tax burden on business operations. According to the data of key tax source enterprises monitored by the STA, the tax burden of manufacturing enterprises in 2022 decreased by 23.3% compared with 2017, and equipment manufacturing sector dropped by 29.5%, which is the largest decrease in taxes. Third, the boosting effect is more prominent. Under the joint effect of a series of tax and other supporting policies, the development of China's manufacturing industry has grown steadily. Tax data shows that from 2018 to 2022, manufacturing enterprises increased their sales revenue by an average of 9.4% annually. Of this, sales revenue of equipment manufacturing increased by an average of 10.3% annually. Purchases of smart, R&D and energy-saving equipment by the manufacturing sector increased by an average of 13.5% annually. In 2022, the added value of the national manufacturing industry accounted for 27.7% of GDP, an increase of 1.4 percentage points from 2020, showing continued momentum with steady progress and quality improvement.

Going forward, we will fully implement and constantly refine tax-and-fee policies in accordance with the plans and deployments of the CPC Central Committee and the State Council, further assist the high-quality development of the manufacturing sector, and strive to foster an enabling environment that is conducive to the development of advanced manufacturing. First, we ought to support manufacturing to become higher-end. We will promote the upgrading of manufacturing to become higher-end through the implementation and improvement of supporting policies such as preferential tax policies for high-tech enterprises and accelerated depreciation of newly purchased fixed assets in key manufacturing industries. Second, we need to help manufacturing become smarter. We will better leverage the role of policies of the additional tax deduction for R&D expenses and preferential tax policies for technology transfer, speed up the digital transformation of the manufacturing sector, realize the deep integration of digital technology, production, and business operations, and continuously improve the level of intelligence. Third, we need to guide manufacturing to become more eco-friendly. We will implement tax-and-fee policies such as corporate income tax exemptions for special equipment investment in environmental protection, energy and water conservation, and the comprehensive use of resources, etc., encourage manufacturing companies to reduce pollution and carbon emissions and become more eco-friendly, and further promote the green, low-carbon and high-quality development of China's manufacturing sector. Thank you.

Yicai.com:

The intensity and effectiveness of this year's proactive fiscal policy will be increased. Can you introduce the preferential tax and fee policies that have been rolled out this year, and what kind of measures are worth looking forward to in the future? Thanks.  

Wang Daoshu:

Thank you for your concern. Preferential tax and fee policies are an important part of a proactive fiscal policy. Since the beginning of this year, in accordance with the plans of the CPC Central Committee and the State Council, fiscal and tax departments have released two batches of preferential tax and fee policies that have been extended or optimized. As a result, an additional 1.2 trillion yuan in tax and fees is expected to be reduced this year. Adding to that, the continued policy of refunding end-of-tax-period VAT credit is expected to reduce more than 1.8 trillion yuan in tax and fee for business entities throughout the year. Overall, these preferential tax and fee policies have the following three characteristics: First, their continuity has been highlighted. A batch of effective policies with high social expectations has been continued to keep certain social expectations stable, such as the halving of urban land-use tax for logistics enterprises' use of land to store bulk commodities and reducing employment security funds for people with disabilities. Second, precision has been improved through policy optimization. We optimized and implemented a series of policies to help micro and small-business entities overcome difficulties and achieve development, such as by reducing VAT payments for small-scale taxpayers and income tax for micro and small enterprises and self-employed individuals, with a focus on the latter two. Third, innovation in institutions has been promoted. We continued additional tax deductions for R&D expenses and increased this deduction from 75% to cover 100% of such expenses for enterprises. This policy will be implemented in the long run to provide institutional support for creating a better tax system, further inspiring enterprises to pour efforts into innovation. Meanwhile, some temporary arrangements and policies have been phased out in an orderly manner after their expected effects were produced, which will not only promote the standardization of the tax and fee policy system but also reinforce the foundation of the tax system that is conducive to fair competition.  

Next, we will continue thoroughly implementing the decisions and plans of the CPC Central Committee and the State Council, making great efforts in four aspects. First, we will intensify efforts to deliver. Each April is an important period for enterprises to declare and pay their taxes and fees. We are seizing this important window of opportunity to roll out a series of new service measures, further strengthen targeted delivery of policies, refine the implementation of policies, and optimize tax handling functions, to see that taxpayers and fee payers know the policies, understand the operations, and can enjoy the benefits. Second, we will follow through and evaluate the effects of preferential tax and fee policies. The implementation of preferential policies has been included as an important part of our efforts to carry out in-depth research and studies. We are working hard to evaluate and analyze the effects of these policies, to deliver tax and fee policies' dividends to the public, and to promote better and tangible results in policy implementation. Third, we will continue to optimize our policies. We are running a campaign for a more coordinated system with fast responses to different problems. In response to the difficulties and problems encountered during policy implementation, prompt actions will be taken to resolve them and facilitate the swift and direct delivery of policy dividends to the public. Fourth, we will strengthen our reserve of policy options. We will coordinate with related departments to pay close attention to changes to economic performance, design better services to build up China's strength in manufacturing, accelerate the implementation of the innovation-driven development strategy, and strengthen our reserve of tax and fee policy options to enrich our policy toolbox, so as to better drive high-quality economic development.  

National Business Daily:

The CPC Central Committee and the State Council place great importance on the development of the private sector. My question is, what factors do the tax authorities weigh up when trying to encourage and support the development of this sector? Thanks. 

Wang Jun:

Thank you for your question. General Secretary Xi Jinping noted that private enterprises and private entrepreneurs are in our ranks. As the head of the STA, my feeling is: they are family. Contributing more than 50% of tax revenue, the private sector is central to ensuring China's national strength. Therefore, our attitude to the private sector is consistent in three aspects.

First, in terms of policy implementation, private enterprises will always be treated impartially. Over the past five years, private enterprises have collectively enjoyed tax cuts, fee reductions, refunds, and deferred tax and fee payments of more than 8 trillion yuan, roughly 70% of the total. Notably, after the state introduced a series of tax and fee support policies, 80% of self-employed individuals in the private sector are no longer required to pay taxes. Going forward, we will continue to actively participate in and diligently implement various tax and fee support policies that benefit private enterprises, just as we have always done.

Second, regarding tax and fee services, we will always attach great importance to providing meticulous care to private enterprises. Approximately 80% of the national taxation departments' service resources are directed towards private enterprises. Additionally, roughly 80% of the current suite of tax and fee service measures are designed to benefit micro, small and medium-sized enterprises (MSMEs), as well as self-employed individuals, which constitute the majority of private enterprises. The STA has established a service office for micro and small enterprises under the tax service department and has collaborated with the All-China Federation of Industry and Commerce for two consecutive years to launch a special campaign aimed at assisting micro and small enterprises. This year, we will introduce a range of new service measures.

Third, we will consistently spare no effort to support private enterprises in terms of providing relief and addressing challenges. Over the past five years, we have actively deepened tax-bank cooperation to address the financing challenges faced by private enterprises. We have utilized corporate tax credit information as an important reference for financial institutions to provide loans to private enterprises, especially micro and small enterprises. This has helped them secure 22.46 million bank loans amounting to 6.22 trillion yuan. Currently and in the future, there may still be some challenges in the supply chain of the private enterprise industry. To address this, we are developing and continually improving the "National Taxpayer Supply Chain Query" platform and related services to assist private enterprises in expanding their supply-demand connections. This will help promote private enterprises to reinforce their weak links. Thank you. 

Science and Technology Daily:

The CPC Central Committee and the State Council have attached great importance to technological innovation. Could you please share the main measures and achievements of the tax department in supporting innovation in recent years? Also, what are your plans to further promote technological innovation in the future? Thank you.

Luo Tianshu:

Thank you for your question. In line with the decisions and plans of the CPC Central Committee and the State Council, tax and fee support policies have been consistently broadening and deepening in their scope to provide better support for technological innovation and development throughout the entire innovation chain and various links. From 2018 to 2022, the average annual increase in tax and fee reductions and exemptions to support scientific and technological innovation reached 28.8%. By 2022, the annual burden reduction scale had reached 1.3 trillion yuan, effectively stimulating the momentum of social innovation and development. I would like to share three aspects of our progress using big data on tax. Firstly, we have invested more in innovation funds. From 2018 to 2022, enterprises' investment in R&D expenses has increased by an average of 25.1% per year. Enterprises are purchasing R&D equipment to enhance their hardware power and buying technical services to increase their software power. The average annual growth rate for purchasing R&D equipment and technical services was 11.5% and 18.3%, respectively. Secondly, the vitality of innovation subjects is stronger. Over the past five years, the number of tax-related business entities in high-tech industries has grown at an average annual rate of 9.1%. This growth rate remains higher than the average growth rate of all tax-related business entities, given that high-tech enterprises have relatively high establishment conditions. Thirdly, the momentum of innovation and development is even stronger. In the past five years, the sales revenue of the high-tech industry has grown at an average annual rate of 16.1%, which is 5.5 percentage points higher than the average growth rate of the entire industry. 

Next, the tax departments will play an important role in taxation functions and continue to excel in four aspects: First, we will support both basic research and application innovation by providing tax incentives for enterprises to invest in basic research and promoting the commercialization of scientific and technological achievements. We will encourage more innovative results and better commercialization of innovative achievements. Second, we will support both the cultivation and growth of emerging industries and the transformation and upgrading of traditional industries. We will further develop preferential tax policies to support the development of emerging industries such as new-generation information technology and new energy vehicles. We will conscientiously implement the institutional arrangement that has been clarified to increase the proportion of R&D expenses deducted from 75% to 100%, to further promote the accelerated transformation and upgrading of traditional industries. Third, we will support startup enterprises to operate with agility and mature enterprises to excel in technology research breakthroughs. We will implement preferential tax policies to encourage venture capital enterprises and entrepreneurship platforms like technology enterprise incubators and help startups grow better. We will further implement preferential income tax policies for high-tech enterprises and encourage mature innovative enterprises to continuously grow and strengthen. Fourth, we will support accumulating "things" and aggregating "people" into innovative elements. On the one hand, policies such as accelerating the depreciation of fixed assets should be implemented to support upgrading and replacing enterprise equipment. On the other hand, individual income tax incentives will be given to enterprises' scientific and technological personnel who obtain equity and those research personnel in universities and colleges receiving rewards for the job-related commercialization of scientific and technological achievements. This will enhance the enthusiasm and creativity of research backbones in various aspects and promote the better conversion of "soft power" into "concrete achievements." Thank you.

Economic Daily:

At the 20th CPC National Congress, proposals were put forward to improve people's well-being and raise their quality of life. Could you please inform us about the practical measures taken by the tax authorities to ensure and improve people's livelihoods? Thank you.

Wang Daoshu:

Thank you for your question. General Secretary Xi Jinping has emphasized that "the people's desire for a better life is the goal we strive to realize."  The tax departments resolutely implemented the decisions and arrangements of the CPC Central Committee and the State Council, adhered to the original mission of "gathering money for the country and collecting taxes for the people," and effectively organized tax revenue to provide solid financial support for safeguarding and improving people's livelihoods and implemented preferential tax policies to continuously release benefits for the people. Here, I will introduce the specific situation in three aspects:

First, we have been actively promoting employment as it is a major concern for people. Small and micro-business entities are the primary channels and driving forces for promoting employment and safeguarding people's livelihoods. In accordance with the arrangements of the CPC Central Committee and the State Council, tax departments have fully implemented preferential tax policies, such as VAT reductions and exemptions for small-scale taxpayers, preferential income tax for small and micro-profit enterprises and individual businesses, and halving of the "six taxes and two fees" for small and micro-business entities, to help stabilize employment and expand job opportunities. As a result, in 2022, these policies will benefit over 80 million business entities, with small and micro-enterprises and individual businesses enjoying beneficiary coverage rates exceeding 99%.

Second, we have focused on reducing burdens. The top concerns are education, healthcare, housing, and other key aspects of people's lives. The tax department has actively implemented preferential tax policies to alleviate the burden on people's livelihoods. Personal income tax reform, implemented in 2018, has yielded a significant tax reduction effect, benefiting workers in general. . In particular, the seven special additional deductions for child education, continuing education, housing loan interest, housing rent, serious illness medical treatment, elderly care, and care for infants under three years old have provided targeted tax relief, addressing livelihood concerns. According to the latest data from this year's personal income tax settlement in the first month, tax reductions through special additional deductions exceeded 150 billion yuan. Of this, taxpayers caring for children and the elderly have received a reduction of close to 110 billion yuan. Additionally, to support residents' reasonable housing needs, our country has continued to implement tax exemption policies for those buying their first house and the life-improving second house, as well as precise tax support policies for constructing and operating government-subsidized public rental housing. These two policies reduced taxes by over 200 billion yuan in 2022.

Third, we have enhanced social insurance services. Social insurance is the safety net for the people. Since the tax authorities began to take charge of levying social insurance premiums, the tax departments have extended their services to all units and the 1.3 billion-plus people covered by social insurance. We have actively optimized tax payment services and expanded their channels, ensuring the social insurance premium budget for years in a row while fully implementing the policies of reducing fees and postponing tax payments. In this way, the "pension money" and "life-saving money" of people can be guaranteed. At the same time, we have worked with relevant departments toward unified national management of basic old-age insurance funds, promoted provincial-level unified management of basic medical insurance, unemployment insurance, and work-related injury insurance; launched pilot programs on long-term care insurance and occupational injury insurance for people in new forms of employment ; and implemented tax support policies for enterprise annuities and individual pensions, further improving the world's largest social insurance system. 

People's livelihoods are no small matter, and we are concerned about each and every thing related to the people. Going forward, we will adhere to a people-centered philosophy of development, firmly fulfill the task of ensuring tax services and improving people's livelihoods, effectively consolidate the financial foundation, and earnestly implement tax and fee support policies so as to ensure tax contributions enhance people's livelihoods and wellbeing. Thank you. 

Wang Jun:

I would like to add one point: tax revenues are collected from, used for, and benefit the people. On March 30, we, along with the Ministry of Education and the Ministry of Justice, launched the 32nd Tax Publicity Month and a special activity of youth education on tax laws on campus. I noted that coverage of the event got lots of attention online. I will share one story about the event here. A student asked me why we publicized tax laws on campus. In response, I asked whether the sports facilities and the audio-visual equipment at their school were good or not, and the answer was yes. I asked whether they needed to pay tuition fees or textbook fees, and the answer was no. Then where did the money come from? I said that the money involved was collected in the form of tax from the student's, say, uncle, aunt, grandma, and grandpa, to develop and improve the compulsory education cause. Then I asked whether it was meaningful to publicize tax laws on campus so that everyone could abide by the laws to ensure tax collection for the sake of the country and the people, and the student gave a positive answer, which I was glad to hear. As you can see, providing for people's livelihoods is the basic responsibility of the tax departments. Thank you. 

The Beijing News:

Since last year, the tax departments have severely cracked down on tax-related legal violations and exposed some typical cases, drawing wide social attention. What are the plans going forward in this regard, and what are the specific arrangements for case exposure? Thank you. 

Luo Tianshu:

Thanks for your question. The tax departments have always focused on both constantly improving tax and fee services and strictly fighting against malicious legal violations such as tax evasion and fraud. Tax inspection departments nationwide investigated and punished 128,300 illegal taxpayers in accordance with the law in 2022, retrieving 195.5 billion yuan in tax losses of various kinds and publicly exposing nearly 900 typical tax-related cases of various types, strongly and effectively regulating the tax collection order. 

Looking ahead, the tax departments will follow the guidance of risk management based on precise and comprehensive analysis, combine punishment and clemency, and focus on improving the efficacy of regulation while ensuring deterrence through punishment. In this way, we aim to render tax law enforcement effective and mighty with a human touch and resolutely safeguard the national taxation security and the legitimate rights and interests of law-abiding enterprises. 

First, we will focus on tax-related risks and promote targeted governance in an orderly manner. We will continuously improve the dynamic supervision system of "credit plus risk." In terms of general tax-related legal violations, the tax departments will successively take five comprehensive steps. The first three are reminding and alerting, urging to rectify, and talking and admonishing, which will grant more taxpayers opportunities to rectify themselves and demonstrate the warmth and flexibility of tax law enforcement. Of course, for those who refuse to rectify or repeatedly break the laws, we will take the fourth step of filing an inspection case in accordance with the law. Regarding serious cases, we will take the last step, publicly exposing them to showcase the might and rigor of law enforcement. 

Second, we will closely monitor tax fraud through the use of falsified invoices and work together to enforce strict punishment. We will continue to collaborate with six departments, including the Ministry of Public Security, to crack down on serious illegal activities that do not create wealth for society and disrupt market order, such as issuing falsified invoices by "fake companies", receiving export rebates through "false exports" and taking advantage of tax concessions through "false declarations." We will strike a heavy blow to illegal activities as soon as they appear and continue to intensify our efforts to eradicate such activities.

Third, we will ensure the implementation of tax relief policies and conduct inspections to address problems promptly. The tax authorities will carry out special campaigns to ensure the implementation of multiple tax policies and crack down on tax-related intermediaries who engage in false advertising and malicious tax planning to firmly prevent the "red envelopes" of tax relief policies from falling into the hands of criminals. At the same time, we will investigate our own problems. Tax officials found to be derelict in their duties in tax evasion and fraud cases, especially those who collude internally and externally or engage in cheating, will be punished severely once discovered. We will also shore up the weak links in tax management after we find them through inspections and address both the symptoms and the root causes of the problems.

Today, the STA and tax authorities at the provincial and municipal level will also announce seven typical cases of tax-related violations. Please pay attention to them. Thank you.

China Securities Journal:

We all know that tax and fee revenue is the financial guarantee for national governance. Could you please tell us how the tax authorities organized tax and fee revenue in the first quarter and the situation going forward? Thank you.

Cai Zili:

Thank you. Organizing tax and fee revenue is the primary responsibility of the tax authorities. We have fully implemented the decisions and arrangements of the Central Committee of the CPC and the State Council, levied taxes and fees in line with laws and regulations, carried out the tax and fee preferential policies, and resolutely avoided collecting unwarranted taxes and fees. In the first quarter, tax authorities nationwide overcame the impact of the epidemic at the end of last year and early this year, along with a high base from the same period of the previous year and this year's continued implementation of tax reduction policies, and collected a total tax revenue (excluding export rebates) of 4.6756 trillion yuan, a year-on-year increase of 0.5%. This achievement marks a good start.

Mr. Wang Jun mentioned before that enterprise sales revenue increased by 4.7% year on year in the first quarter, which seems to be somewhat different from the growth rate of tax revenue. This is mainly because the tax declared by enterprises in the current month is the tax generated by their production and operation activities in the previous month. Therefore, the first quarter's tax revenue reflects economic activity of last December, and January and February of this year. In contrast, enterprises' sales revenue represents current production and operational activities, leading to a one-month difference between the two figures.

In the first quarter, tax revenue collected by tax authorities fell by 1.2% year on year in January, but increased by 0.1% in February and 5.2% in March. The increase has turned from negative to positive and is rising monthly, showcasing a positive trend of gradually improving growth. This also reflects the good momentum of China's accelerating economic recovery under a series of supporting policies issued by the Central Committee of the CPC and the State Council. Looking at different levels, tax revenue at local levels increased by 2.5% year on year in the first quarter, which was two percentage points higher than the overall national level. This will help guarantee local financial resources. Looking at different regions, in the first quarter, the tax revenue of the eight provinces and municipalities that have net contributions to central finance, including Beijing, Tianjin, Shanghai, Jiangsu, Zhejiang, Fujian, Shandong and Guangdong, grew by 2.2% year on year, which was 1.7 percentage points higher than the overall national level.

Meanwhile, in the first quarter, tax authorities collected social insurance premiums totaling 1.9116 trillion yuan, guaranteeing timely and full payment of "pension money" and "life-saving money" to the public. In addition, tax authorities collected non-tax revenue and supplementary insurance premiums, occupational annuities, and other streams of revenue totaling 1.3849 trillion yuan.

In summary, in the first quarter of 2023, tax authorities nationwide collected 7.9721 trillion yuan in tax and fee revenue (excluding export rebates). In the second quarter, the pro-growth policies issued by the Central Committee of the CPC and the State Council will continue to play their role and China's economy will maintain a steady upward momentum. In addition, due to the large-scale VAT credit refunds handled in the second quarter of last year, the revenue base is relatively low. Tax revenue is expected to grow rapidly in the second quarter of this year. We will continue to organize tax and fee revenue in accordance with laws and regulations, strengthen the monitoring of revenue quality, resolutely avoid collecting unwarranted taxes and fees, and effectively build up a solid financial foundation for high-quality development. Thank you.

Bauhinia Magazine:

This year marks the 10th consecutive year since the launch of the campaign designed to streamline procedures for filing and paying taxes. How is the campaign progressing? What solid measures will be taken to bring convenience to taxpayers and fee payers? Thank you.

Wang Jun:

Thank you for your questions. I'm very glad to answer them. According to the requirements of General Secretary Xi Jinping, we should always serve the people and rely on the people. As the tax department, we are responsible for enforcing tax and fee collection.

Over the past nine years, the STA has introduced 539 innovative service measures, and local tax departments at all levels have issued a total of over 41,000 supporting measures. That has greatly contributed to the transition of tax and fee services in four aspects. First is the transition from mainly providing offline services to offering both online and offline services. Second is the transition from providing policy services based on people's queries to proactively delivering policy services. Third is the transition from offering generic services to gradually paying more attention to personalized services. Fourth is the transition from providing procedural services to offering services focused on protecting the legitimate rights and interests of taxpayers. Taxpayers and fee payers have responded that the methods of tax and fee payment have been optimized, with higher efficiency, friendlier services and lighter burden.

Since the beginning of this year, the STA has solicited over 1 million pieces of opinions and suggestions from taxpayers and fee payers and amasses over 100,000 pieces of opinions and suggestions from taxation staff at the community level. Based on that and according to the full implementation of new requirements of the CPC Central Committee and new policies of the State Council, the STA has introduced 42 new measures in two batches to improve tax and fee services. Last week, I made research trips to Henan and Shaanxi provinces and found that these measures have been well implemented. However, during face-to-face communication with taxpayers and fee payers, they offered one common demand. That is, a decision taken at the executive meeting of the State Council on March 24 that six preferential tax and fee policies will continue to be implemented and optimized, and they hope to have rapid, convenient and full access to these preferential policies. After learning about the strong demand, I immediately organized multiple rounds of research and discussions, and so last night, we determined the third batch of 20 measures to bring more convenience to taxpayers, focusing on solving this demand. These measures will be released after today's press conference. For example, in terms of speeding up the implementation of policies, focusing on different subjects, we will formulate themed lists of policies and deliver them to various types of taxpayers and fee payers individually to bring policies directly to people in a more targeted and meticulous way. For another example, when it comes to upgrading key services, we will develop specific policy guidance for additional tax deduction for R&D expenses and we will work with relevant departments to launch the "Self-Employed Businesses Service Month." As for the policy on reducing the average time to issue export tax refunds for first- and second-class export enterprises to three working days, we will also extend the duration of the policy to the end of this year to support the better development of foreign trade and export enterprises. And to make tax services more convenient, we will further optimize the functions of the e-tax system, expand the scope and channels of services that can be accessed online, through cellphone apps, and with an undertaking that relevant conditions have been met. We will provide more services to automatically calculate the tax reduction and exemption amounts, and automatically prefill the information for tax declaration. In doing so, we can both ensure that taxpayers and fee payers benefit from preferential policies and make tax services more convenient.

I just mentioned that we have carried out the 32nd tax publicity month nationwide with the theme of "Bringing Tax Benefits to Millions of Households and Jointly Building Modernization" starting on April 1. The campaign focuses on promoting the implementation of preferential tax and fee policies and service measures to further push for the effective and detailed implementation of the campaign designed to streamline procedures for filing and paying taxes.

We are fully aware that there is no end to the improvement in tax and fee services, and that the satisfaction of taxpayers and fee payers is the most important standard. Next, by applying new technologies, we will continue to innovate and improve our services, and we will introduce the fourth and fifth batches of service measures. For instance, we will soon begin piloting cross-border bilingual tax services for equity transfers of overseas enterprises, so that cross-border tax declaration can be handled without the need to be present in person. At the same time, we will pilot smart opening for enterprises newly founded in China in several regions. That is, as soon as an enterprise registers, the tax-related information will be matched automatically, making it possible for the enterprise to get invoices as soon as possible, and we will continue to expand the scope of the trials. For large enterprises with good credit, we will pilot making out invoices based on needs, without a cap on the invoice amount. For taxpayers running simple businesses, we will pilot simplified tax declaration and constantly expand the scope of the trials.

In summary, we will keep working to improve and enhance the quality and efficiency of tax and fee services to ensure that people can always enjoy convenience, and taxpayers and fee payers can not only have easy access to good services but also get things done well and receive timely feedback on their queries both online and offline. We also invite the media to provide their supervision. Thank you.

Xing Huina:

Today's briefing is hereby concluded. Thank you to all the speakers and friends from the press. Goodbye.

Wang Jun:

Thank you, chairperson and friends from the press. Thank you.

Translated and edited by Zhu Bochen, Huang Shan, Li Xiao, Zhou Jing, Liu Caiyi, Yuan Fang, Yan Bin, Yang Xi, Wang Yanfang, Liu Qiang, Wang Yiming, Zhang Rui, Ma Yujia, Xu Xiaoxuan, Zhang Junmian, Cui Can, Xu Kailin, He Shan, Li Huiru, David Ball, Tom Arnsten, and Jay Birbeck. In case of any discrepancy between the English and Chinese texts, the Chinese version is deemed to prevail.

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Read in Chinese

Speakers:

Mr. Yu Jianhua, minister of the General Administration of Customs of China (GACC)

Mr. Sun Yuning, vice minister of the GACC

Mr. Zhao Zenglian, director of the General Office of the GACC

Chairperson:

Ms. Shou Xiaoli, deputy director general of the Press Bureau of the State Council Information Office (SCIO) and spokesperson of the SCIO

Date:

March 20, 2023

Shou Xiaoli:

Ladies and gentlemen, good morning. Welcome to this press conference held by the State Council Information Office (SCIO). Today, we are holding the 11th press conference in the series "Embarking on the New Journey — A Government Perspective." We are delighted to have invited Mr. Yu Jianhua, minister of the General Administration of Customs of China (GACC), to brief you on the efforts of China Customs to safeguard borders and advance Chinese modernization, and to take your questions. We also have with us Mr. Sun Yuning, vice minister of the GACC, and Mr. Zhao Zenglian, director of the General Office of the GACC.

Now, let's give the floor to Mr. Yu for his introduction.

Yu Jianhua:

Thank you. Ladies and gentlemen, friends from the media, good morning. My colleagues and I are delighted to be here today to meet and speak with you. First and foremost, on behalf of the GACC, I would like to express our gratitude to the media for your coverage of our work throughout the years, as well as for your oversight of our customs enforcement efforts. 

The GACC is the national agency responsible for border administration and supervision. As we embark on a new journey in the new era, the GACC has a deep understanding of the decisive significance of establishing Comrade Xi Jinping's core position on the Central Committee of the Chinese Communist Party (CPC) and in the Party as a whole and establishing the guiding role of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, and upholds Comrade Xi Jinping's core position on the Party Central Committee and in the Party as a whole and upholds the Central Committee's authority and its centralized, unified leadership. Guided by the strong leadership of the CPC Central Committee with Comrade Xi Jinping at its core, we have fully and faithfully applied the new development philosophy on all fronts, worked to create a new pattern of development, promoted high-quality development, and pursued progress while ensuring stability. We have fulfilled the responsibility of better balancing the domestic and international situations, coordinating epidemic prevention and control with economic and social development, and development with security. We remain focused on safeguarding borders, promoting development and contributing to overall economic and social progress.

Safeguarding borders is a fundamental duty of customs, and an important responsibility in the pursuit of a holistic approach to national security. We carry out lawful and science-based supervision and employ advanced technologies, such as big data and intelligent inspection, to enhance the efficiency of port inspections and tax collection, ensuring the safety and order of imported and exported goods. In 2022, tax revenue collected by customs reached 2.28 trillion yuan, an increase of 13.6%. We have been the first line of defense in preventing imported COVID-19 cases, having detected 55,000 positive cases among inbound personnel, which accounts for 67% of all port detections in the past three years. We have made significant contributions to winning a decisive victory in national epidemic prevention and control. We carry out strict inspections and quarantines to prevent the entry of major animal and plant epidemics and the invasion of alien species, having detected a total of 580,000 harmful organisms. We have severely cracked down on smuggling, having filed and investigated more than 4,500 criminal smuggling cases worth over 120 billion yuan, thus ensuring national security and a favorable business environment. We launched a 100-day special action on integrated management of dangerous goods at ports, clearing more than 2,400 batches of dangerous goods that were stockpiled at ports due to the epidemic, and detecting over 1,600 batches of false or concealed reports. This timely elimination of the significant risk of stockpiled dangerous goods in high-temperature weather conditions ensured port safety.

Promoting development is the due responsibility of the GACC in serving the people. We have taken multiple measures to serve foreign trade stability and quality improvement, continuously optimized the business environment at ports, made cross-border trade more convenient, and significantly reduced overall clearance time for imports and exports. We regularly released foreign trade data and various trade indices to serve macro decision-making and foreign trade enterprises. We have taken the lead in serving high-level opening-up, promoting innovative customs supervision systems for the Hainan Free Trade Port, free trade zones (FTZs), the Guangdong-Macao In-Depth Cooperation Zone in Hengqin, and comprehensive bonded zones. We have actively served the high-quality Belt and Road cooperation, promoted the "smart customs, smart borders, smart connectivity " concept to be included in the strategic planning of the World Customs Organization, and signed 80 customs cooperation agreements with many countries. We have supported the construction of international logistics corridors such as the China-Europe Railway Express. We have done everything possible to help enterprises overcome difficulties, issuing 23 support measures to promote the stable growth of foreign trade. We have launched activities inviting customs officials to the front line to promote policies, effectively doing practical things and solving problems for enterprises. We have conscientiously implemented tax reduction and preferential tax policies, with total tax cuts and refunds amounting to 285 billion yuan.

This year marks the first year of fully implementing the guiding principles of the 20th CPC National Congress. Customs across the country will focus on the "1+1+6" key tasks. The first "1" refers to deeply and solidly implementing the guiding principles of the 20th CPC National Congress by comprehensively studying it. The second "1" refers to promoting the construction of a socialist modernized customs with Chinese characteristics, with smart customs as a focal point. We will serve high-quality development and high-level opening-up with efficient customs supervision. The "6" refers to the six key tasks of building a full-chain safety supervision system, holding a strong first line of defense against the virus, implementing measures to promote stability and quality of foreign trade, serving high-quality Belt and Road cooperation, creating a high-level platform for opening-up, and exercising full and rigorous Party self-governance with high-quality standards. Customs across the country will keep in mind that we must never forget our original aspiration and founding mission, that we always stay modest, prudent and hardworking, and that we have the courage and ability to carry on our fight. The GACC will be loyal, responsible and dedicated to safeguarding the country's borders, promoting development, and working together toward a common goal. As per the new government's directives, we will continue to advance and refine our customs policies and practices to align with the grand blueprint. We will translate the key objectives outlined in the 20th CPC National Congress into concrete actions within customs, strive to achieve tangible outcomes and contribute to China's modernization efforts.

Now, my colleagues and I are happy to answer your questions. Thank you.

Shou Xiaoli:

Thank you. The floor is now open for questions. Please identify the media organization you work for before asking your questions.

CCTV:

China is the world's largest trading country in goods. What are the main challenges that the GACC is facing during its supervision work? How will you respond to these challenges? Thank you.

Yu Jianhua:

Thank you for your questions. It's often said that customs is the gateway to a country. As China opens wider to the outside world, the GACC will have an increasing responsibility to safeguard the entrance to the country.

In 2022, China's foreign trade exceeded 42 trillion yuan, hitting a record high in the history of trade and putting unprecedented pressure on the supervision work of customs authorities. Last year, the total freight volume of imports and exports under customs supervision reached 4.8 billion metric tons. We deployed a total of 13 million transportation vehicles including cargo ships, airplanes and freight trains, and supervised 320 million pieces of cross-border mail. Figuratively speaking, if we put all of these imported and exported goods on a freight train end to end, it would circle the equator 30 times; if we put all of the cargo containers end to end, it would make two rows between the Earth and the moon. This fully demonstrates China's momentum as the world's largest trading country in goods, and represents China's contribution to the world as well as the responsibilities and challenges for the GACC in its supervision efforts.

The huge quantity is one thing. On the other hand, in terms of the object of the GACC's services, the number of import and export enterprises registered with the GACC reached 1.85 million, three times that of 10 years ago. There are more and more enterprises engaged in trade. In terms of types of trade, in addition to general trade and processing trade, there are many new emerging business models such as cross-border e-commerce and market purchases. 

In terms of supervisory responsibilities, in addition to preventing epidemic diseases, such as COVID-19 and African swine fever, we should also prevent the invasion of alien species such as red imported fire ants and desert locusts; in addition to testing iron ore and dangerous chemicals, we should also ensure the safety of imported and exported food; in addition to cracking down on foreign garbage and drug trafficking, we should also search for "problematic maps" and illegal propaganda materials in postal parcels; and in addition to detecting concealed ivory and other cultural relics, we should also prevent the entry of mice, cockroaches and other pests hidden in cargo containers. In 2022, customs across China identified 55,000 positive cases of COVID-19, intercepted 580,000 pests, supervised 590 million metric tons of imported and exported dangerous chemicals, returned and destroyed 2,900 batches of defective food and cosmetics, and seized 1.2 million prohibited items of all kinds and 2.8 metric tons of drugs. If we fail to steadfastly hold these fronts, there will be severe consequences.  

You just asked what our main challenges are. In face of the super-sized trading scale, various kinds of trading models, demanding regulatory requirements and significant security concerns, how can we ensure "effective controls, moderate relaxation and quick clearance?" I believe these are the main challenges we are facing.

Of course, having challenges is not a bad thing. Instead, it is a driving force to promote reform and innovation of customs. We will adhere to the Party's comprehensive leadership over the GACC, insist on customs reform toward socialist modernization, take the driving role of both reform and technology, and vigorously promote the construction of "smart customs." We will take smart customs as a starting point to promote customs reform and modernization, and build world-class customs that leads the trend of international customs supervision and serves our country's high-quality development. We will strive to realize digital, automated and smart customs clearance and management, continuously improve supervision efficiency, strengthen the three lines of defense in and outside China and at ports, build a customs operation mechanism featuring "response, correspondence and reaction," and foster an all-round and whole-chain supervision system. At the same time, we should clearly recognize that fighting corruption is a common task facing customs authorities all over the world. Therefore, the GACC should not relax for a moment. We should resolutely eliminate the black sheep who "rely on customs and live off customs," continue sounding the bugle, and forge a loyal, clean and responsible high-quality customs team, to comprehensively improve the modernization of the customs governance system and governance capacity, and write a new chapter for customs along the Chinese path to modernization. Thank you.

The Poster News APP:

Business entities are key to promoting the development of foreign trade. Last year, we saw the GACC roll out a raft of measures to improve the quality and stability of foreign trade and help enterprises tide over difficulties and reduce costs. What results have been achieved? Will the GACC launch more policies this year? Thank you. 

Yu Jianhua:

Foreign trade has always been a great concern to all of us. The epidemic has directly impacted foreign trade. The GACC has frequently communicated with import and export enterprises, so we are well aware of the difficulties facing foreign trade enterprises. We have resolutely responded to the CPC Central Committee's call for assistance to enterprises. Last year, we released 23 support measures, which local customs authorities refined into over 1,300 detailed measures based on local conditions. It's fair to say that these policies have received massive support among business entities and achieved the desired results.

Regarding the smooth clearance, compared to other large trading countries, China's import and export of goods has not been hindered by the epidemic, and customs clearance has become even faster and more convenient. In December 2022, the overall customs clearance time for imports and exports across the country dropped 67% and 92%, respectively, from 2017.

In terms of reducing costs, we supported enterprises to enjoy various tax relief policies. Last year, total tax refunds and cuts for foreign trade companies were worth 285 billion yuan.

In terms of improving services, we implemented measures such as "delivering policy information to enterprises' doorsteps," adjusting the inspection and supervision mode for imported major commodities to "release before inspection," and opening "green channels" for agricultural and food products. We also removed 87 commodity codes from the catalogue of import and export commodities subject to inspection and quarantine and optimized the business environment at ports.

Currently, we are evaluating 23 measures and will retain them as much as possible to ensure policy continuity. In addition, we will consider new policies and measures to address the pains, difficulties, and bottlenecks faced by companies. We will mainly focus on the following aspects:

First, we will facilitate the logistics of imports and exports. We will accelerate the development of smart customs and support the building of smart ports and intelligent borders. Through technological means, we will further improve the efficiency of cross-border logistics.

Second, we will improve the business environment at ports. We will push forward the building of a single-window platform to facilitate international trade, offering one-stop customs clearance services for companies.

Third, we will reduce enterprise costs. We will help enterprises to make full use of the tariff preferences in free trade agreements, such as the RCEP, and reduce the costs during import and export.

Fourth, we will foster new forms of business. We will innovate ways of customs supervision for cross-border e-commerce to ensure targeted supervision and faster customs clearance. We will support the development of new business formats such as market procurement trade and bonded maintenance service. 

Next, we will conduct in-depth research and study and continue to provide the service of "delivering policy information to enterprises' doorsteps." We will step out of the office and go to enterprises, airports, and ports to find out their needs. We will work together with enterprises to tackle difficulties and challenges and spare no effort to promote the stable and high-quality development of foreign trade.

Thank you.

Yicai.com:

Cross-border trade is closely related to people's daily lives and has developed rapidly in recent years. How do customs authorities improve and maintain efficiency while ensuring safety during customs clearance?

Yu Jianhua:

Cross-border e-commerce is of great public concern and has achieved rapid development. In 2018, China's cross-border e-commerce transactions exceeded 1 trillion yuan and doubled to over 2 trillion yuan last year. We will have Mr. Sun answer your question.

Sun Yuning: 

Thank you. Cross-border e-commerce has evolved to a global platform for buying and selling goods. It has served as a new engine driving China's foreign trade development as well as a leverage to promote high-quality development. In the new decade, cross-border e-commerce has entered a stage of rapid growth. Over the past five years, China's cross-border e-commerce imports and exports increased from 1 trillion yuan in 2018 to 2.11 trillion yuan in 2022, showcasing significant growth both in volume and quality. An increasing number of Chinese-made products are entering the international consumer goods market through cross-border e-commerce. At present, there are 165 cross-border e-commerce comprehensive pilot zones nationwide, covering 31 provinces, autonomous regions and municipalities. They have become an essential carrier and platform for developing cross-border e-commerce.

As a new form of international trade, cross-border e-commerce has achieved vigorous growth and had a profound influence on international trade. It differs from traditional trade in that it is fragmented, IT-based, and involves a massive amount of goods. Data shows that the number of declaration lists of imports via cross-border e-commerce is 56 times that of the number of goods declarations during the same period, with an average value per list of less than three ten-thousandths of the value of the goods declarations. We have seized prohibited goods, such as firearms, explosives, drugs, controlled psychotropic substances, intellectual property rights-infringing items, and exotic pets. It can be said that these new situations have posed challenges to customs regulatory work.

We have introduced a management system that is different from customs clearance for traditional trade to cater to the development trends and characteristics of cross-border e-commerce. Through classification management and tailored measures, we have created a customs supervision model that is suitable for cross-border e-commerce. Building on the existing "Business to Consumer (B2C)" policy, we proposed a new regulatory policy that better serves "Business to Business (B2B)" and "Business to Business to Consumer (B2B2C)" transactions. In this process, we have strengthened the role of technology and developed and launched a unified IT-based system for cross-border e-commerce regulation, which integrates and manages transaction, payment, logistics, and other related data. At the same time, we have fully promoted the paperless registration of overseas warehouses for cross-border e-commerce export, allowing enterprises to register their information with one customs authority and use it nationwide. As of the end of February, there were 1,713 registered overseas warehouse enterprises.

Next, the GACC will continue to adhere to the regulatory concept of "innovation, inclusiveness, prudence and coordination," and put equal emphasis on regulation and development. It will mainly focus on the following two aspects: On the one hand, we will work harder to strengthen regulations. First, we will prevent the smuggling of cross-border e-commerce by checking the authenticity of customs declaration forms via intelligent means; second, we will strengthen cooperation with cross-border e-commerce platform enterprises and control risks in advance to further reduce the operation risks of enterprises and supervision risks of customs; third, we will expand the application of commodity barcodes and strengthen the management of commodity sources to boost consumers' confidence; and fourth, we will pay close attention to issues regarding global food safety and issue warnings in a timely manner. On the other hand, we will take effective measures to upgrade services. First, we will support the e-payment of taxes for cross-border e-commerce businesses to facilitate online procedures; second, we will promote "inspection before installation" for less than container load (LCL) export cargo to further facilitate logistics efficiency and reduce the costs of enterprises; third, we will advance data analysis services so as to provide strong anticipatory guidance for the high-quality development of new business forms; fourth, we will optimize declaration procedures for overseas warehouses to further expand exports for enterprises; and fifth, we will constantly improve measures on returning imported and exported goods to ease the worries of both enterprises and consumers. Thank you.

China News Service:

Combating smuggling is an inherent function of customs authorities. Could you explain how the GACC keeps up pressure against smuggling to ensure social security, economic security and fair competition? Thank you.

Yu Jianhua:

"Cracking down on smuggling will not cease as long as there is water in the sea." Smuggling has always been a cancer of international trade, endangering national security and economic order, and even affecting people's lives and health. After years of strict crackdowns, the momentum of smuggling has been contained, and the overall situation is stable and controllable despite the complex situation. There are two situations that deserve our particular attention: 

First, smuggling activities are becoming better organized and more professional. For example, smuggling has become more collectivized and professional in terms of refined oil products, foreign garbage and drugs. The collusion between domestic and cross-border groups, the more rigorous organization as well as the more professional division of labor have brought new challenges to customs authorities in their supervision and anti-smuggling work.

Second, smugglers are using more intelligent and covert means. For example, in cases involving the smuggling of cigarettes, red wine, cosmetics and high-end consumer goods, some smugglers use network technology to link transactions; some control "parallel traders" to transport goods, or use people who frequently cross the borders to escape the crackdown; some use offshore duty-free shopping to purchase on behalf of others on Hainan Island; and some even forge cross-border e-commerce documents to get through customs under a false pretense.

Considering these features, we, together with the public security department and the coastguard, launched a joint campaign to target the smuggling of key commodities through key channels and in key areas. Over the past five years, we have investigated and handled 20,000 smuggling cases worth more than 500 billion yuan. The number of foreign garbage smuggling cases dropped from a peak of 481 to 98 last year. The seizure of ivory products fell from 9.2 metric tons at its peak to 70 kg last year. The GACC is a four-time winner of the United Nations Asian Environmental Enforcement Award and a two-time winner of the Clark R. Bavin Wildlife Law Enforcement Award, demonstrating China's image as a responsible major country to the world.

This year, we will continue to maintain the high-pressure crackdown on smuggling, focusing on the following three aspects:

First, we will strengthen the special anti-smuggling campaigns. Special joint campaigns such as "National Sharp Sword" and "National Warriors" have been launched to combat smuggling activities involving refined oil products, foreign garbage, guns and drugs.

Second, we will advance comprehensive regulations. We will give full play to the comprehensive role of customs ports in their supervision, inspection and quarantine as well as auditing, and will promote all-round monitoring so as to form a multi-faceted anti-smuggling network.

Third, we will strengthen comprehensive governance. Setting the National Anti-Smuggling Office in the GACC, we will further encourage local governments to undertake their primary responsibility of comprehensive anti-smuggling control, and cooperate with the public security department, coastguard authorities, and other law enforcement departments to form a synergy.

Through these efforts, we will establish a comprehensive anti-smuggling network, making it impossible for smugglers to hide and their activities to go unnoticed. Thank you.

Cover News:

We have noticed that in recent years, customs authorities have been focusing on facilitating customs clearance and improving the business environment at ports. May I ask what new measures customs authorities are planning to introduce next? How can we continue to optimize the business environment at ports? Thank you.

Yu Jianhua:

This questions is very important. Creating a good and convenient business environment at ports is the main work of customs. Mr. Zhao will answer this question.

Zhao Zenglian:

The business environment at ports is directly related to the interests and sense of fulfillment of the majority of business entities. It has been a matter of broad concern across all sectors of society for some time. Over recent years, customs, in close cooperation with all parties, has launched a series of innovative measures aimed at optimizing the port business environment and has achieved certain results.

These measures can be summarized in several aspects: five consecutive years of special actions to promote cross-border trade facilitation; streamlining regulatory documents of import and export links; significantly reducing the overall clearance time of import and export goods through ports; further promoting the reform of customs clearance facilitation; standardizing and reducing the cost of import and export links; and continuing to improve informationization of port management.

Thanks to these measures, port clearance time is shorter, customs clearance costs are lower, and customs clearance procedures are more convenient. The effectiveness of these efforts was also acknowledged in this year's government work report .

In regards to optimizing the business environment at ports, there is always room for improvement, and we are constantly striving to refine our goals and maintain persistence. In the next step, we will continue to launch new and effective measures, which can be summarized in 15 words: optimize facilities, build platforms, promote connectivity, strengthen cooperation, and improve efficiency.

First, we will optimize port facilities. We are working with relevant parties to accelerate the expansion of important border port construction projects and further improve border crossing capacity. We are guiding the implementation of the free trade port layout program in Hainan province to accelerate the construction of the free trade port and to provide port facilities to realize independent customs operations as scheduled.

Second, we will build a service platform. Mr. Yu just mentioned the establishment of a single window for international trade. We will further play its role as a comprehensive service platform for export tax rebate declarations and automatic capture of invoice information to facilitate the process for businesses to apply for tax rebates. We will optimize services related to "customs clearance + logistics" and "foreign trade + finance" to provide enterprises with customs clearance and logistics information inquiries, export credit insurance, cross-border settlements, and financing services.

Third, we will promote internal and external connectivity. We are working with all parties to actively promote the reopening of land border ports. At present, land border crossings for freight have resumed as long as conditions permit and the relevant passenger transport routes have also resumed opening. We will further promote the development of cross-border trains, such as China-Europe freight trains and the new land-sea transit routes for the western region, and support the development of sea-rail combined transport and other forms of multimodal transport around the world.

Fourth, we will strengthen international cooperation. We are vigorously promoting international cooperation on smart customs, smart borders, smart connectivity based on the World Bank's new assessment system for the business environment to coordinate and promote the construction of smart ports. We are steadily promoting green lanes for fast customs clearance of agricultural and sideline products, promoting single window cooperation between China and countries along the Belt and Road, and promoting the exchange and sharing of documents related to cross-border trade.

Five, we will improve customs clearance efficiency. Based on preliminary assessments, we will continue to promote shipside direct deliveries, direct loading upon arrival, combined ports, and other customs clearance facilitation reform pilots. We will guide various regions to publish the port clearance process and the main operational time limits based on practical situations. By stabilizing customs clearance time within a reasonable range, we can provide enterprises with relatively stable customs clearance expectations. Thank you.

Zhonghongwang:

We noticed that in 2022, in response to backlogs of dangerous goods exported at some ports, customs organized a 100-day campaign for the comprehensive management of dangerous goods at ports. What is the specific content of this campaign, and how effective has it been so far? After the end of the special campaign, will the results be fixed as a long-term mechanism to continue to play a corresponding role? Thank you.

Yu Jianhua:

Port security is indeed a major responsibility of customs, and we have a high sense of responsibility to prevent and resolve risks in this area. Let's invite Mr. Sun to answer the questions.

Sun Yuning:

Coordinating development and security and giving full attention to every-minute workplace safety is an important instruction General Secretary Xi Jinping made for workplace safety. Customs have kept this instruction in mind, adhered to the principle that safety management must go with business management, and continuously ensured workplace safety at ports with a sense of responsibility to always remain alert.  

Since last year, some imported dangerous goods have been kept for long periods of time at ports due to the pandemic, and along with scorching weather, risks to workplace safety have risen. In response, we launched a 100-day special action campaign to comprehensively manage dangerous goods at customs ports across the country, cleared more than 2,400 batches of dangerous goods accumulated at ports because of the pandemic, investigated and found more than 1,600 batches that were not cataloged or spuriously reported, and filed over 500 administrative punishment cases. The overall clearance time for dangerous goods has been reduced by more than 60%, ensuring the safe and stable operation of ports.

We believe that the end of the 100-day special action campaign is not the end of our efforts. China is a big trader of dangerous goods. With the accelerated economic recovery, the country's import and export of dangerous goods have increased remarkably. At the same time, despite efforts to hit back against all types of illegal behavior, illegal issues still exist, such as companies not reporting, lowering the danger level while reporting, or underreporting dangerous goods, which has posed a serious challenge to customs' safe and efficient regulation. This year, we will focus on our work in the following three respects:

First, we will continue to enhance integrated management. Last year's 100-day special action campaign addressed the problem of dangerous goods stored for long periods of time at ports. This year, we launched a half-year special action to crack down on unreported or spuriously reported dangerous goods. We will combine efforts to crack down, regulate, and deter and fully strengthen risk prevention and control, on-spot supervision, and follow-up inspections to improve the regulation chain and realize coordination in law enforcement of customs nationwide. In the meantime, coordinated law enforcement will be enhanced to cement regulatory networks for workplace safety with relevant departments. 

Second, we will advance regular governance. The effective experience and practices gained from special actions should be fixed as regular governance measures. This aims to prevent the recurrence of the accumulation of goods at ports and keep up the pressure against unreported or spuriously reported goods so as to smooth the way for law-abiding companies and make law-breakers pay the price. Meanwhile, we will improve the regulatory efficiency of the entry and exit of dangerous goods and deepen the reform of the relevant supervision and inspection model. Currently, we have launched pilot programs at five ports, including Shanghai, and will soon summarize and assess the experience to apply these steps across the country. 

Third, we will prevent major safety risks. To be specific, while comprehensively managing dangerous goods at ports, we will focus on health and quarantine, animal and plant quarantine, food safety, law enforcement safety, laboratory safety, and other key areas. We will repeatedly and continuously ensure the identification, ranking, and elimination of security risks, prioritize prevention, and stick to the bottom line of safety and the red line for regulation.

Thank you. 

Phoenix TV:

Data recently released by the GACC showed that China's total foreign trade dropped by 0.8% in the first two months of this year. We also noticed many media reports of an increasing number of empty containers at ports, triggering the public's concern over this year's imports and exports. What is the GACC's judgment regarding this year's foreign trade? Thank you.  

Yu Jianhua:

Thank you for your question. This year's foreign trade is of deep public concern. As you said, the GACC has issued data for the first two months of this year, which was interpreted by the relevant departments. The GACC has closely monitored foreign trade developments since March. Overall, we believe that foreign trade has gotten off to a stable start and presented positive growth trends. In terms of scale, the total export value in the first two months surpassed our expectations and increased by 0.9%, hitting a record high. The total import and export value in the first two months exceeded 6 trillion yuan, only the second time in history. The peak for the same period before the pandemic was less than 5 trillion yuan. Regarding the composition, as China took the lead in reopening the economy during the pandemic, the export of anti-pandemic supplies and stay-at-home economy products significantly increased, raising the foreign trade baseline. Based on our calculations, excluding one-time factors, imports and exports in the first two months of this year grew by more than 10%. As for trends, based on weekly monitoring, China's foreign trade rebounded since February and increased by over 15% in the last week in February compared with the previous week. As to neighboring countries, China's foreign trade is performing better than neighboring economies that have released relevant data. 

Certainly, foreign trade does face many difficulties and challenges, with the weakening of foreign demand being the most concerning. High global inflation and sluggish growth in major economies have continued to impact global trade. The WTO recently predicted that global trade in goods during the first quarter of this year will be weak, and it expected it to grow by a mere 1% for the entire year. In addition, some countries' decoupling with others and severing supply chains, geopolitical risks, and recent fluctuations in the financial markets of some Western countries have impacted the global trade environment, which is also an external challenge for promoting stability and improving the quality of China's foreign trade.

However, we must also see the positive side. In the first two months, more companies have entered the field of foreign trade in terms of business types, and 46,000 new foreign trade businesses have been registered with Customs authorities, which shows that people's confidence is accumulating and recovering. In terms of orders, according to our tracking and monitoring, the proportion of companies with increasing export orders has continued to rise. In terms of new kinetic energy, the total exports of electric vehicles, lithium batteries, and solar cells increased by 60%. The imports and exports of cross-border e-commerce of concern to the public increased by 15.8%. As for trade diversification, China's imports and exports to countries along the Belt and Road increased by more than 10%, and the total imports and exports to other RCEP members increased by more than 3%.

You also mentioned the issue of empty containers, which we are also paying attention to. This is due to reasons including an excessive amount of new containers that were put into use in the previous period, lower domestic storage cost, and the short-term return of empty containers in large quantities after the easing of the epidemic situation abroad, as well as seasonality. A large number of empty containers are ready to depart at our ports, which to some extent can be viewed as a positive reflection of the international market's continued optimism about China's export capacity in the next stage. According to the latest customs data, since late February, the volume of export containers being used has continued to grow.

On the whole, the foreign trade situation remains severe and complicated, but it also contains many opportunities, and the difficulties are more global in nature. In comparison, China still possesses an obvious competitive advantage. With the overall improvement of China's economic situation, the momentum of the stable start of foreign trade in the first two months is expected to continue. Therefore, we are fully confident in achieving the goal of stabilizing and improving the quality of China's foreign trade this year. Thank you.

Shenzhen Satellite TV Zhinews: 

We have noticed that many young people are fond of keeping exotic pets nowadays. At the same time, we have also noticed that this year's No. 1 Central Document included the issue of exotic pets for the first time. How does the customs prevent the invasion of alien species caused by exotic pets and ensure the biological security of China's borders? Thank you.

Yu Jianhua:

Exotic pets are a threat to China's biological security. The GACC attaches great importance to the issue and has adopted a series of measures to intercept them. For details, I will invite Mr. Zhao Zenglian to answer your question.

Zhao Zenglian:

Thank you for your question, and I appreciate your interest in this topic. "Exotic pets" are a new term and a trending topic. They are called "exotic" because they are different from traditional companion animals such as cats and dogs. They are considered special because some of them were once feared and are now kept as pets. These include such animals as snakes, lizards, and horned frogs. These exotic pets are peculiar in appearance, colorful, and unique.

Just now, you said that the No. 1 Central Document mentioned "exotic pets" for the first time, which reflects that exotic pets are no longer just simple household pets but rather come with other concerns. These are mainly reflected in three aspects. First, these exotic pets are mostly foreign species, which poses a big threat to biodiversity of organisms. When such exotic pets escape or are abandoned in nature, they may multiply and spread rapidly without natural enemies, threatening to local ecosystem. Second, they threaten the safety of agriculture, forestry, animal husbandry, and fishery. Once in nature, they can pose a huge threat to local species and even leading to a sharp decline in their populations. Third, they pose a threat to the health and safety of the people. Some of these animals are aggressive, such as the fire salamanders and messor barbaruses, and others are highly poisonous, such as the giant centipedes and poison dart frogs. In addition, some exotic pets carry germs that can threaten people's lives.

Customs must take action when there are calls from the central government and societal concerns. We have taken a series of measures to strictly prevent the invasion of alien species such as "exotic pets." First, we have strengthened port inspections, and customs have used technological means such as X-ray and CT machines to prevent "exotic pets" from entering the country through mail. Customs supervise over 400,000 pieces of mail arriving from overseas every day. Second, we have carried out special operations, such as "Green Shield at Entry at the Border" and taken comprehensive measures to prevent the delivery of "exotic pets" in cross-border e-commerce, to crack down on criminal gangs and rings that illegally import "exotic pets" and other alien species. Third, we strengthened joint prevention and control. Internally, we enhanced inter-departmental cooperation to form law enforcement synergy. Externally, we strengthened source control to ensure that overseas competent authorities shoulder their responsibilities. Fourth, we have created a joint social governance atmosphere: If no one buys them, no one will sell them. Customs used a combination of online and offline methods to continuously strengthen publicity and education for delivery companies and inbound travelers and make every effort to enhance public awareness of biosafety.

In 2022, customs intercepted 991 types of "exotic pets" and other alien species in 2,012 cases, including large ants measuring 4 centimeters long, large beetles measuring 10 centimeters long, and large centipedes measuring over 30 centimeters long. I have brought some pictures here to show you today. The "exotic pets" we intercepted were safely and strictly disposed of according to laws and regulations.

Next, customs will resolutely implement the deployment and requirements of the "No. 1 central document," strengthen port inspections, crack down on illegal activities, and firmly guard the nation's gateways. We will continue strengthening policy interpretation, publicity, and education, exposing typical cases, and enhancing public awareness of ensuring biosafety.

I would also like to take this opportunity to make a public call through our media friends: Everyone has a responsibility in ensuring biosafety and can contribute. I hope that "exotic pet" enthusiasts will not purchase illegally imported small animals and will not harm nature with their personal hobbies. Thank you.

Shou Xiaoli:

The last two questions.

National Business Daily:

Could you provide an update on the current status of the development of China's special customs supervision zones? What are the difficulties and pain points in addressing the imbalances of developing these zones? What achievements have been made so far? Thank you.

Yu Jianhua:

Special supervision zones represent a crucial responsibility for customs supervision. As our nation continues to open up, an increasing number of these zones have been established, each with unique circumstances, and customs supervision pressure remains high. I will invite Mr. Sun Yuning, who oversees this work, to answer the questions.

Sun Yuning:

Thank you for your questions. With China's reform and opening-up policies, special customs zones emerged and after more than three decades of development, they have become an important platform and carrier for opening up to the outside world. Last year, the total import and export value of these special zones reached 8.4 trillion yuan, accounting for 20% of China's total foreign trade value. These zones, which account for less than 0.005% of the country's territorial area, contributed one-fifth of the country's total foreign trade.

To adapt to the development needs of foreign trade in different periods, China has established six kinds of special zones: bonded zones, export processing zones, bonded logistics parks, bonded port zones, comprehensive bonded zones, and cross-border industrial zones. Following the requirements of scientific and coordinated development, we are actively implementing the arrangements and requirements of the State Council and promoting the transformation and upgrading of various types of special zones into comprehensive bonded zones. Currently, there are 167 special zones in the country, of which 156, or 93.4% of the total, are comprehensive bonded zones, covering 31 provinces, municipalities, and autonomous regions.

In the new era, the development of special zones has shown three main characteristics. First, the scale of the zones continues to expand. Last year, the total import and export value of special zones doubled from 2012, and their proportion of foreign trade increased from 15.7% to 20%. Second, the industrial structure continues to be optimized. Bonded R&D, bonded maintenance, "Bonded Plus," and other industries are developing, and emerging business forms such as financial leasing and cross-border e-commerce are booming, showing a diversified development trend. In 2022, the total import and export value of bonded maintenance reached 198.4 billion yuan, a year-on-year increase of 32.7%. Third, the zones' development is more coordinated. There is an evident trend that the zones leverage the core role of leading enterprises to drive the clustered development of upstream and downstream enterprises. In provinces and municipalities such as Sichuan, Chongqing, Henan, and Shaanxi, the proportion of the total import and export value of special zones exceeds 50% or even 60% of the local foreign trade import and export total value. 

You mentioned that there are still imbalances in developing special zones. The development of special zones in the eastern region of China is better than those in the central and western regions. Uneven development is also a problem for some provinces where multiple special zones were set up. Also, some special zones face issues of insufficient development, such as reliance on a single industry, prominent homogenization phenomena, inadequate industrial supporting facilities, and unclear competitive advantages.

Regarding these issues, we will focus on the following three aspects. First, we will proactively contribute to the "dual circulation" development paradigm. We will accelerate our efforts to introduce reform measures for the high-quality development of comprehensive bonded zones in the new era, proactively join the unified domestic market, and promote the integrated development of domestic and foreign trade. Second, we will proactively support transforming and upgrading certain special areas. We will scale up support for the innovative development of the "Bonded Plus" business form. We will also foster industrial clusters such as those involving research and development in bonded zones, help make breakthroughs in core technologies in key areas, and contribute our part to achieving sci-tech self-reliance. Third, we will proactively promote the construction of smart comprehensive bonded zones. Taking deepening reform in comprehensive bonded zones as a focal point, we will develop new models for customs supervision, strengthen the enabling role of science and technology, and keep improving the business environment and boosting enterprises' sense of gain. Thank you.

Guangdong Radio and Television (GRT):

We noticed that the chief executives of the Hong Kong and Macao special administrative regions (SARs) recently met with Mr. Yu. What achievements has the GACC made in supporting the development of the Guangdong-Hong Kong-Macao Greater Bay Area? What measures will be taken next? Thank you.

Yu Jianhua:

Thank you for your interest in this issue. Last week, I met with Ho Iat Seng, chief executive of the Macao SAR, and his Hong Kong counterpart John Lee. The development of the Greater Bay Area is a topic we all care about. As one of the moves to advance "one country, two systems," the Greater Bay Area is home to three customs territories with three kinds of currency in circulation. The practice is the first of its kind for the construction of bay areas around the world. Last year, the foreign trade volume of the nine mainland cities in the Greater Bay Area, Hong Kong, and Macao reached $2.5 trillion, accounting for 5% of the world's total. It is fair to say that the Greater Bay Area is one of China's most open and economically vibrant regions. The customs authorities will shoulder their share of responsibility and play a greater role in contributing to the development of the Greater Bay Area.

We have made efforts in the following two areas in recent years.

First, to facilitate the flow of factors, we have expedited efforts to develop new customs supervision regulations and rolled out 54 measures to support establishing major cooperation platforms in Hengqin, Qianhai and Nansha. We have developed new customs clearance models, such as those combining different ports and offering one-stop clearance services, which have been implemented across the nine mainland cities in the Greater Bay Area. We also extended the Single E-lock Scheme (SELS ) to customs authorities between Guangdong and Hong Kong, as well as between Guangdong and Macao. The so-called SELS refers to the practice employed by customs authorities in the two cities, using e-locks on cross-border vehicles to strengthen supervision during transit. Vehicles under such a scheme can enjoy express customs clearance services in ports on the opposite side without undergoing inspections or unpacking examinations. This is one of the measures for trade facilitation, and we will extend this trial scheme to more areas. We have also successfully implemented the policy allowing private cars from Macao to enter and leave the mainland via the Zhuhai highway port of the Hong Kong-Zhuhai-Macao Bridge. A total of 53,000 private cars from Macao have entered and left the mainland in this way since the beginning of this year. We have also established express channels for fresh agricultural products. Moreover, we have carried out timely customs inspection and clearance services, making every effort to ensure supplies to Hong Kong and Macao.

Second, with regard to safeguarding trade security, the customs authorities of Guangdong, Hong Kong, and Macao have stepped up risk analysis and coordination efforts, and are exploring the development of an integrated risk prevention and control system for the Greater Bay Area. We have improved the long-term coordination mechanism to combat smuggling and launched joint campaigns, including the "San Cha Ji" (Trident) and "Qingwan" (Clean Bay) operations, among the three areas, in a bid to crack down on various illegal activities, such as maritime cross-border smuggling in areas including Guangdong, Hong Kong and Macao.  

Currently, the construction of the Guangdong-Hong Kong-Macao Greater Bay Area is being carried out at an accelerated pace. In the next step, the customs authorities will closely collaborate with related sectors to enhance the "hard connectivity" of facilities and the "soft connectivity" of cooperation. We will make efforts in three areas to help build a top-tier bay area and world-class city cluster in Guangdong, Hong Kong and Macao.

First, we will focus on the development of platforms. We will double our efforts to roll out pilot trials in the Hengqin Cooperation Zone. We will work towards promoting the implementation of the policy allowing goods from overseas and from FTZs to enter and exit China without customs supervision, while goods entering China from FTZs will be subject to integrated customs management. We will also support the innovation of customs supervision systems in the Qianhai Cooperation Zone and contribute to constructing an international shipping and logistics hub in Nansha.

Second, we will facilitate customs clearance. We will strengthen mutual recognition of customs inspections between the three regions and proactively extend the SELS to customs authorities. We will keep implementing the policy that allows private cars from Macao to enter and leave the mainland via the Zhuhai highway port of the Hong Kong-Zhuhai-Macao Bridge and expedite efforts to extend this policy to private cars in Hong Kong. We will further mutually recognize Authorized Economic Operator (AEO) status and deepen cooperation in single-window customs clearance system. We will work to build connectivity in trade data and explore methods that help enterprises complete declarations to both customs as well as inspection and quarantine authorities with a single submission. We will also optimize and simplify customs clearance models and facilitate the flow of people and goods. We will strengthen coordination and cooperation and jointly make effective use of and manage the Hong Kong-Zhuhai-Macao Bridge, which is a bridge of dreams coming true, concerted efforts, self-confidence, and rejuvenation.

Third, we will strengthen our cooperation with law enforcement. We will enhance information sharing and boost law enforcement coordination. We will also strengthen cooperation among Guangdong, Hong Kong and Macao in fields such as inspection and quarantine, intellectual property rights protection, and combating smuggling. These efforts will jointly maintain a sound development environment in the Greater Bay Area.

Thank you.

Shou Xiaoli:

Thank you to all the speakers and journalists. Today's press conference is hereby concluded.

Translated and edited by Wang Yiming, Wang Qian, Qin Qi, Wang Wei, Cui Can, Zhang Junmian, Zhang Tingting, Liu Qiang, Liu Caiyi, Yang Xi, Xu Xiaoxuan, Wang Yanfang, Yan Bin, Zhang Rui, Yuan Fang, Zhu Bochen, Zhang Rui, Li Huiru, David Ball, Tom Arnsten, and Jay Birbeck. In case of any discrepancy between the English and Chinese texts, the Chinese version is deemed to prevail.

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Read in Chinese

Speakers:

Ms. Cao Shumin, vice minister of the Cyberspace Administration of China (CAC)

Mr. Yue Zhongming, director of the Economic Law Department of the Legislative Affairs Commission of the Standing Committee of the National People's Congress  

Mr. Wang Xiaoguang, director general of the Bureau of Law Popularization and Rule of Law of the Ministry of Justice (MOJ)

Mr. Li Changxi, director general of the Bureau of Law-Based Cyberspace Governance of the CAC  

Chairperson:

Ms. Xing Huina, deputy director general of the Press Bureau of the State Council Information Office (SCIO) and spokesperson of the SCIO

Date:

March 16, 2023

Xing Huina:

Ladies and gentlemen, good morning. Welcome to this press conference held by the State Council Information Office (SCIO). Today, the SCIO released a white paper titled "China's Law-Based Cyberspace Governance in the New Era," and organized this press conference to walk you through its main content. The white paper delves into Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era and thoroughly puts into practice the guiding principles of the 20th National Congress of the Communist Party of China (CPC). Centering closely on Xi Jinping Thought on the Rule of Law and a series of important remarks on building China's strength in cyberspace made by General Secretary Xi Jinping, the document outlines the nation's integrated efforts to advance cyber legislation, law enforcement, judiciary work, as well as programs to spread legal knowledge via the internet, publicize cyber laws, and cultivate the public's awareness in laws. It introduces China's positive progress in ensuring law-based cyberspace governance and the country's markedly enhanced capacity in developing rule of law in cyberspace. It also notes that China proactively carries out international exchanges and cooperation on law-based cyberspace governance, contributing ideas and solutions to global internet governance.

At around 18,000 Chinese characters, the white paper consists of a preface, main body and conclusion. Specifically, the main body is divided into six parts: "Upholding the Rule of Law in Cyberspace," "Consolidating the Legal System for Cyberspace Governance," "Keeping Order in a Rule-Based Cyberspace," "Defending Fairness and Justice in Cyberspace," "Promoting Public Awareness and Competence in Law-Based Cyberspace Governance" and "Increasing International Exchanges and Cooperation in Law-Based Cyberspace Governance."

The white paper is published in eight languages — Chinese, English, French, Russian, German, Spanish, Arabic and Japanese — by the People's Publishing House and Foreign Languages Press. It is available at Xinhua Bookstores across the country.

To help you better understand the document, we have invited Ms. Cao Shumin, vice minister of the Cyberspace Administration of China (CAC), to walk you through the relevant information and take your questions. Also joining us today are Mr. Yue Zhongming, director of the Economic Law Department of the Legislative Affairs Commission of the Standing Committee of the National People's Congress (NPC); Mr. Wang Xiaoguang, director general of the Bureau of Law Popularization and Rule of Law of the Ministry of Justice (MOJ); and Mr. Li Changxi, director general of the Bureau of Law-Based Cyberspace Governance of the CAC.

Now, I'll give the floor to Ms. Cao Shumin for a brief introduction.

Cao Shumin:

Ladies and gentlemen, friends from the media, good morning. It is my pleasure to attend this press conference today. The white paper "China's Law-Based Cyberspace Governance in the New Era," released today, is the country's first of its kind regarding law-based cyberspace governance.

Since the 18th CPC National Congress, the CPC Central Committee with Comrade Xi Jinping at its core has attached great importance to law-based cyberspace governance and made a series of major arrangements. Committed to upholding the rule of law in cyberspace, China has seen historic achievements in law-based cyberspace governance. The white paper systematically summarizes the concept and practices of China's law-based cyberspace governance since the country was fully connected to the internet in 1994 and especially in the new era, which has offered Chinese ideas and solutions to global internet governance. Next, I will brief you on the document's main content from three aspects.

People-centered development. In China, we must ensure that people's interests and wishes are reflected, their rights are protected, and their wellbeing is enhanced in every aspect throughout the entire process of law-based cyberspace governance,  so that the people's sense of fulfillment, happiness, and security can be strengthened.

Further development of the internet. The essence of law-based cyberspace governance is to guarantee the healthy and orderly development of the internet. Under law-based cyberspace governance, we will ensure the innovation-driven growth of cyberspace under the rule of law.

Proceeding from realities. Based on the realities of our cyberspace development practices, China handles the relationships between development and security, freedom and order, openness and autonomy, and administration and service in an appropriate manner. We have employed law-based thinking and approaches to deal with the problems in internet development.

Innovation-driven cyberspace governance. By focusing on new situations and problems of law-based cyberspace governance in the new era, we have made accelerated efforts to promote innovation in the concept, content, approach, and methods of law-based cyberspace governance so as to raise its capacity for internet governance in all areas. 

Openness and cooperation. China has played an active part in working with other countries to formulate rules for cyberspace governance and engaged in international exchanges and cooperation in law-based cyberspace governance, drawing from the experience of other countries and pioneering a distinctively Chinese model of internet governance in line with international best practice.

Second, China's achievements in law-based cyberspace governance in the new era. 

China has taken accelerated efforts to promote cyber legislation. We have promulgated more than 140 laws on cyberspace since 1994, forming a cyber legislation framework with the Constitution as the foundation, supported by laws, regulations, and rules, endorsed by traditional legislation, and underpinned by specialized cyber laws. The groundwork for cyber legislation has been laid.

China has been strengthening law enforcement in cyberspace. We have carried out actions against practices that illegally collect and use personal data, punishing online copyright infringement and piracy. Actions have been taken against the monopoly and unfair competition in the field of the platform economy. We have also launched Operation Qinglang special campaigns. Accelerated efforts have been taken to establish and improve a system for comprehensive cyberspace governance, and a sound cyber environment has been maintained.

China has fully implemented cyber justice. We have improved the rules of cyber justice, established internet courts, and promoted digitalizing procuratorial work. We have carried out activities to combat cybercrime in accordance with laws, strengthened judicial protection of minors' rights and interests in cyberspace, and safeguarded the people's rights and interests in cyberspace. 

China has promoted legal education in cyberspace in an innovative manner. We have carried out internet plus public legal education and strengthened legal literacy through online media, raising public awareness and readiness regarding the rule of law.

Third, China is fully engaged in international exchanges and cooperation in the field of law-based governance of cyberspace.

China is playing an active role in rule making. We resolutely safeguard the international system with the United Nations at its core and support the participation of all countries in global cyberspace governance on an equal footing. We have also taken an active part in the formulation of regional cyberspace governance rules.

China has conducted extensive exchanges and cooperation. We have increased international law enforcement and judicial cooperation on cybersecurity to crack down on cyberterrorism. We also cooperate with the United Nations Children's Fund and other organizations to jointly protect the rights and interests of minors in cyberspace. 

Third, we have created platforms for dialogue. By building exchange platforms, including the World Internet Conference, China has played an active role in promoting understanding and mutual trust in the rule of law in cyberspace between different countries. 

The 20th CPC National Congress made new plans for promoting China's strength in cyberspace and the rule of law. China stands ready to work with the international community in following the global governance philosophy featuring extensive consultation, joint contribution and shared benefits, and jointly promote law-based governance of the global internet so that digital development can deliver greater benefits to people in all countries. 

Next, my colleagues and I will take your questions. Thank you.

Xing Huina:

Thank you. The floor is now open for questions. Please identify the media outlet you represent before asking your questions.

Legal Daily:

The white paper summarizes the philosophy and practice of law-based cyberspace governance since China became fully connected to the internet, particularly since China has entered a new era, contributing Chinese solutions and wisdom to global internet governance. As such, what were the major considerations for releasing the white paper "China's Law-Based Cyberspace Governance in the New Era"? Thank you.

Cao Shumin:

Thank you. I will answer the question. Since the 18th CPC National Congress, the CPC Central Committee with Comrade Xi Jinping at its core has put forward a range of new philosophies, thoughts, and strategies in the great practice of law-based governance on all fronts and building cyberspace strength, and formed Xi Jinping Thought on the Rule of Law and the important ideas of General Secretary Xi Jinping on building China's strength in cyberspace. These thoughts have guided China to further enhance law-based cyberspace governance. The law-based cyberspace governance system with Chinese characteristics has continued to improve. Cyber legislation, law enforcement, and judiciary work have advanced alongside programs to spread legal knowledge via the internet. We have deepened international exchange and cooperation on this front. Historic achievements in law-based cyberspace governance have been made in the new era. A trail has been blazed in law-based cyberspace governance with Chinese characteristics in line with international best practices. 

Releasing the white paper "China's Law-Based Cyberspace Governance in the New Era" is conducive to domestic and international understanding of China's law-based cyberspace governance. Thank you. 

Thecover.cn:

Over the past decade in the new era, China has advanced the rule of law and improved legislation related to emerging sectors such as the internet. What progress has been made in law formulation, and what role has it played? Thank you. 

Yue Zhongming:

Thank you for your question about the legislation of cyber laws. Since the 18th CPC National Congress, the National People's Congress and its Standing Committee have implemented decisions and plans of the CPC Central Committee on building China's cyberspace strength and making China a digital country. We have advanced legislation of cyber laws, continued to optimize relevant laws, systems, and regulations, and formed a complete system of cyber laws. Remarkable achievements have been attained in cyber legislation providing legal guarantees for sustainable and healthy internet development. In the past decade, we have promulgated five laws in this field. 

First, the Cybersecurity Law was enacted in 2016. It has implemented the real-name system for internet users, established systems and measures for ensuring the security of online products and services, network operation and key information infrastructure, and safeguarded online information security.

Second, the Electronic Commerce Law was promulgated in 2018. It has provided a full set of regulations on e-commerce operation, with clear provisions on the responsibilities of e-commerce platform operators and business owners on these platforms. It has maintained fair market competition and strengthened the protection of consumer rights and interests, as well as intellectual property rights.

Third, the Data Security Law was formulated in 2021. In response to the risks and hidden dangers in data security, it has established mechanisms for categorized and classified data protection, risk monitoring and early warning, emergency response, and data security review. At the same time, it has facilitated data security and development, promoted the security and openness of government data, strengthened China's capacity for ensuring data security, and advanced the rational and effective use of data in accordance with the law.

Fourth, the Personal Information Protection Law was enacted in 2021. Focusing on the concerns of the people, it has further defined and refined principles on protecting personal information and rules on the processing of personal information, and specified the rights and obligations for processing personal information. It has improved the mechanism for protecting personal information and safeguarded citizens' rights and interests in personal information.

Fifth, the Law on Combating Telecom and Online Fraud was promulgated in 2022. It has built a comprehensive governance system for the telecommunications, finance and internet sectors and was specifically created to fight telecom and online fraud. Focusing on this specific area, the law has provided strong legal support for preventing, curbing and punishing telecom and online fraud.

Apart from these five specific laws, the NPC Standing Committee has continued to amend traditional laws and regulations to cover the internet area. Over the years, a series of laws has been revised, including the Law on the Protection of Consumer Rights and Interests, the Law on Food Safety, the Law on Advertisement, the Law on the Protection of Minors, the Law Against Unfair Competition, the Anti-Monopoly Law and others. Through the revisions, relevant institutions and regulations have been improved with regards to the protection of consumer rights and interests in online transactions, food safety responsibilities of internet platforms, internet advertisements, the protection of minors in cyberspace, and unfair competition and monopoly on the internet. Meanwhile, the Civil Code and the Amendment to the Criminal Law have been formulated, outlining specific stipulations concerning the protection of civil rights and combating online criminal activities in new internet business forms. Thank you.

Red Star News:

Many NPC deputies and CPPCC members proposed enacting a special law against cyberbullying during this year's two sessions. At the end of last year, the CAC issued a notice on taking stronger steps to deal with cyberbullying. What measures will be taken by relevant departments to curb cyberbullying? Thank you.

Li Changxi:

That is a good question. Recently, cases of cyberbullying have attracted widespread attention from the public. Relevant authorities have attached great importance to that and taken proactive steps to fight cyberbullying. In November, the CAC issued a notice on taking stronger steps to control cyberbullying. Major websites and platforms have fully implemented the requirements and built and improved relevant prevention and control mechanisms. 28.75 million pieces of information related to cyberbullying have been intercepted and removed. 1.65 million notices have been issued to netizens reminding them to post appropriately. One-click prevention notices have been sent to 28,000 users. 22,000 accounts have been issued with severe punishments for cyberbullying. And the risk of cyberbullying over hot issues has been effectively prevented. Recently, departments of cyberspace affairs have guided major platforms to issue guides on preventing cyberbullying and to help netizens effectively protect themselves from cyberbullying in multiple aspects, including risk notifications, one-click prevention, private message protection, reporting and filing complaints. Going forward, the departments of cyberspace affairs will continue to urge websites and platforms to fulfill their primary responsibilities for fighting cyberbullying, regularly publish information on the prevention and control of cyberbullying, and expose typical cases in a timely manner to resolutely safeguard the legitimate rights and interests of netizens.

During the recently concluded "two sessions," we observed that the NPC deputies and CPPCC members put forward proposals to crack down on online violence and create a healthy online environment. Many of them emphasized the urgent need to accelerate targeted legislation on online violence. These proposals are truly meaningful. Our research has shown that, current comprehensive laws, such as the Civil Code, the Criminal Law, and the Law on Penalties for Administration of Public Security, as well as specialized laws, like the Law on the Protection of Minors, the Law on the Protection of Women's Rights and Interests, and the Law on the Protection of Heroes and Martyrs, along with relevant judicial interpretations issued by the Supreme People's Court and the Supreme People's Procuratorate on defamation, infringement of personal information, and violation of personal rights, have all made provisions on online violence. However, the existing laws and regulations still need to be more targeted, better coordinated, and more effective, in order to bring more satisfactory results to the public. 

Moving forward, we will further intensify our efforts to establish regulations and systems from the perspective of combatting online violence. We will promptly introduce relevant departmental regulations and collaborate with relevant departments to conduct research and strive to improve the legal system. We will also strengthen protection and relief for affected parties and respond in a timely manner to the feedback and demands of the people. Thank you.

CCTV:

My questions are, how has China achieved quite a few results in law-based cyberspace governance in less than 30 years after being connected to the internet, and can you share your experiences in this area? Thank you.

Cao Shumin:

Thank you for your questions. In China, we refine the law-based cyberspace governance as we proceed with our work. We innovate while carrying forward previous practical approaches, and have gained valuable experiences in the process. And these can be summarized as follows.

First, we have adhered to the overall leadership of the Party in this area. We have implemented the Party's requirements for governing the cyberspace and ensured that the Party's leadership is present throughout all links and all aspects of law-based cyberspace governance, ensuring that related work always advances in the correct political direction.

Second, our approach in this area has always been people-centered. The law-based cyberspace governance directly influences more than one billion internet users and concerns the total population of more than 1.4 billion. We have continued to carry out a series of special operations such as "Jingwang" (purifying the cyberspace), "Qinglang" (promoting internet civilization and pooling positive energy), and "Humiao" (protecting minors). We have increased efforts to address prominent issues that are complained about strongly by people, such as online pornography, rumors, and violence, telecom and internet fraud, algorithm abuse, and minors addicted to online games. Our goal is to create a safe, fair, healthy, civilized, and clean cyberspace for the people.

Third, we have adhered to the path of law-based internet governance with Chinese characteristics. Based on our experience regarding the development of the internet, we have promulgated basic, comprehensive, and overarching laws such as the Cybersecurity Law, the Data Security Law, the Personal Information Protection Law, the E-commerce Law, and the Anti-Telecom and Online Fraud Law. Our focus has been on improving the legal rules for the digital economy, establishing a legal system for protecting internet-based rights and interests, drawing the legal red line for cybersecurity, improving the norms for cyberspace governance, and promoting various systems to become more systematic, mature, and fully formed.

Fourth, we have adhered to a sound work pattern in advancing law-based cyberspace governance. We have coordinated the relationships between development and security, freedom and order, openness and autonomy, and administration and service in an appropriate manner. We have also adhered to governing the internet according to the law while improving the online environment by promoting civic morality. We have also encouraged the development of the internet with support and better regulation, and taken a coordinated approach to the rule of law at home and in matters involving foreign parties, so as to boost the innovative development of the internet through high-quality rule of law. So far, China's internet users have reached 1.067 billion. From 2012 to 2021, the compound annual growth rate of China's digital economy reached 15.9%. It has become a main driver of our economic growth. China's Internet of Things (IoT) now connects more cellular terminals than mobile phone users. The world's largest and most advanced fiber-optic broadband and 5G networks have been built in China, forming the world's largest, most widely applied, most innovative, and most vibrant network society.

Fifth, we have continued to promote innovation in the work of law-based cyberspace governance. We have accelerated all-around innovation in the concept, content, and measures of the rule of law in cyberspace. We have created and improved the rules on new technologies and new fields, established legal rules for deep synthesis and algorithm-based recommendation, and used network information technology to empower the traditional judiciary, so as to expand the new model of 'internet plus public legal education' and give the people direct access to the government's public legal education information .

Sixth, we have made cohesive efforts in law-based cyberspace governance. We have ensured that the whole country has been involved. We have also given full play to the enthusiasm, initiative, and creativity of various departments, local governments, enterprises, and internet users, and we have also coordinated and promoted the rule of law in various fields, such as online content and management, cybersecurity, and information technology , so as to keep the internet develop within the confines of the law. 

The valuable experience has been an important guarantee for advancing law-based governance in all respects and building up our strength in cyberspace in the new era. Such experience must persist over a long time and be continuously enriched, improved, and developed. Thank you.

Southern Metropolis Daily:

The internet has become a new space where people study, work, and live, and it has also become a new channel and new method for popularizing the law. Publicity and education on the rule of law via the internet have been long-term basic work for the law-based governance of cyberspace. Since the 18th CPC National Congress, what has been done to publicize the law via the internet?

Wang Xiaoguang:

Thank you for your care about our work on popularizing cyber laws. Since the 18th CPC National Congress, the Ministry of Justice and the National Office of Law Popularization have earnestly implemented Xi Jinping Thought on the Rule of Law and the important ideas of General Secretary Xi Jinping on building China's strength in cyberspace. They have taken the popularization and education on the rule of law on the internet as long-term basic work for the law-based governance of cyberspace, organized localities and departments to employ the internet to spread knowledge of the law, and enhanced people's awareness of and literacy in cyber laws and regulations. I will use four keywords, "system, platform, product, and activity," to brief you on our work in this regard.

First, in terms of institutional improvements, the system of online law popularization continues to improve. The Fourth Plenary Session of the 18th CPC Central Committee made a clear requirement to expand the applications of new media and new technologies for law popularization. The seventh five-year plan on improving legal awareness (2016-2020) emphasized promoting the campaign of spreading the knowledge of the rule of law via the internet. The eighth five-year plan (2021-2025) proposed to carry out smart legal publicity from an internet thinking and all-media perspective.

Second, in terms of platforms, we have given full play to various online platforms and media in law popularization. For example, many platforms such as the Xuexi Qiangguo app, people.cn, xinhuanet.com, and legaldaily.com.cn, have launched special columns focusing on the rule of law. The Ministry of Justice has strengthened the functions of its smart legal publicity platform, and facilitated information sharing with online platforms, such as China Court Trial Online and China Judgements Online . As of now, over 30,000 accounts for law popularization have been set up on online platforms, including Weibo accounts, WeChat official accounts, mobile applications and WeChat video channels. The total views of the WeChat official account "China legalinfo" reached 667 million in 2022, with its followers exceeding 30 million.

Third, in terms of products, we have provided a diverse range of online law popularization products. Combining the needs of different groups for law popularization, we have adopted various forms such as graphics, cartoons, comics, short videos, livestream, and online music to provide knowledge of the law, interpret relevant laws and regulations, and promote the socialist spirit of the rule of law through multiple channels such as microblogs, WeChat official accounts, and so on.

Fourth, in terms of activities, we have further integrated online and in-person law popularization activities. All localities and departments have conducted a variety of law popularization activities both online and in-person during important dates such as the National Constitution Publicity Week, the National Security Education Day, and the Civil Code Publicity Month. The CAC has actively implemented the responsibility system of "whoever enforces the law shall popularize the law," conducted a series of relevant activities, and adopted a case-based method to address the issues of public concern such as the use of the internet to spread illegal information, infringement of personal information rights, telecommunications network fraud, and internet protection of minors. All this work has greatly promoted law-based cyberspace governance.

Using the internet to popularize the law has increased the arrival rate, popularization rate and awareness rate of the knowledge of the law. The concept of the rule of law combining rights and obligations, individual freedom and social responsibilities has been well-received by the public. Respecting the law, abiding by the law, and learning and using the law have increasingly become the prevailing consensus and basic principle in cyberspace. Thank you.

People.cn:

According to the white paper, the groundwork for cyber legislation has been laid, contributing to and improving the socialist legal system with Chinese characteristics. I would like to ask, what are the characteristics of cyber legislation in the new era? What else needs to be done to advance the work and improve cyber legislation in the future? Thank you.

Li Changxi:

This is a very good question. A critical aspect of law-based cyberspace governance is legislation. The groundwork for cyber legislation has been laid. China has formulated a system of laws on cyberspace governance with distinct Chinese characteristics through the creation of basic, comprehensive, and overarching laws such as the Electronic Commerce Law, Electronic Signature Law, Cybersecurity Law, Data Security Law, and Personal Information Protection Law. It presents the following three characteristics.

The rank of cyber legislation has gradually moved up over time. Early-stage cyber legislation primarily consisted of administrative regulations and departmental rules, such as the Regulations on the Security and Protection of Computer Information Systems and the Provisions on Protecting the Personal Information of Telecommunications and Internet Users. Now, with the promulgation of laws such as the Cybersecurity Law and the Personal Information Protection Law, cyber legislation has played an increasingly overarching role built on a more solid foundation.

Secondly, cyber legislation values a scientific and democratic legislative process. The multiple challenges brought by the technological nature, rapid development, broad scope, complex regulatory objects, and the internet's constantly evolving issues require a scientific and democratic legislative approach to accurately address these issues. In the process of drafting cyber legislation, the Standing Committee of the National People's Congress, the State Council, and relevant departments have made the draft available to the public and solicited opinions from various parties through seminars and symposiums. This approach truly promotes development and ensures good governance through effective laws.

Thirdly, cyber legislation is innovative and forward-thinking. China places great importance on future needs and continuously explores and researches relevant legislation to address new problems and challenges. Cyber legislation keeps up with technological developments and practical needs, exemplified by the Data Security Law, which achieved a breakthrough in China's legal governance of data security from scratch. It made top-level institutional designs in important areas such as data classification and grading, important data protection, and data security review. As the world's first specialized legislation on data security, it also provides valuable insights and solutions for other countries and regions to consider.

In the future, we will continue to consider cyber legislation as an important part of China's socialist legal system. We will implement the strategic deployment of "exercising law-based governance on all fronts" and "stepping up legislation in key, emerging, and foreign-related fields" proposed in the report to the 20th CPC National Congress. We will attain the objectives of promoting development and regulating supervision simultaneously and continue to make progress in institutionalizing cyber legislation while further refining legislation in areas such as data, platforms, and technology. Thank you.

CRI:

Mr. Yue just mentioned the Law on Combating Telecom and Online Fraud formulated last year. I want to inquire further about the reasons behind its formulation and the specific measures it provides for combating telecom and online fraud. Thank you.

Yue Zhongming:

Thanks for your question. Telecom and online fraud has been rampant, and the general public hates it. The Law on Combating Telecom and Online Fraud, which was enacted last year, adheres to a problem-oriented, result-oriented and precise prevention approach. The law strengthens the systematic concept, pays attention to the source of treatment and comprehensive treatment, and carries out the comprehensive management of the whole chain of personnel, information, technology and funding chains related to telecom and online fraud. The main systems and measures include the following five aspects.

First, we have strengthened the responsibilities of all sectors. The responsibilities of each department, each unit, and each link have been clearly defined, and strict legal action will be taken against those who fail to fulfill their duties.

Second, we have intensified punishment. We have built comprehensive measures to punish and prevent criminals involved in telecom and online fraud and crack down on all kinds of illegal and semi-legal industries engaged in fraud.

Third, we have strengthened industrial governance. We have made institutional provisions for the outstanding problems reflected in each chain and each link. We have closed loopholes, established rules and regulations, and also stipulated corresponding responsibilities and penalties for non-performance of industry governance obligations.

Fourth, we have strengthened countermeasure technology. We have promoted sharing risk information and providing technical support for combating and curbing illegal and criminal activities.

Fifth, we have adhered to joint management and coordination. We have mobilized the forces and resources of all sectors of society, clarified responsibilities, and created a strong anti-fraud atmosphere in the whole society. Thank you.

Science and Technology Daily:

New technologies and applications, which have driven the internet's vigorous development, have also challenged internet governance. What experiences can China share in this regard? Thank you.

Li Changxi:

Thanks for your attention to new technologies and applications. To regulate new technologies and applications in accordance with the law, we should proceed from the overall situation of national and social development. We believe that we should not only strengthen the research and judgment of the situation, grasp and adapt to the trend of the development of new technologies and new applications, but also improve laws, regulations, policies and systems. We should improve the system and mechanism while promoting new technologies and new applications to better serve the high-quality development of the economy and society. 

First, we need to strengthen overall planning. We should adhere to the rule of law to promote the development and governance of new technologies and applications. With a focus on promoting development, we need to improve the regulatory system, thinking and methods and explore a regulatory model that adapts to the characteristics of new technologies and applications and is conducive to innovative development and fair competition. We will promote the formation of a collaborative governance situation where government management, corporate responsibilities, social supervision, and netizens' self-discipline work together. At the same time, we must practice the principles of extensive consultation, joint contribution and shared benefits in global governance and actively participate in the global governance of new technologies and applications.

Second, we need to improve the regulatory basis. According to the development needs, we should formulate and revise relevant legislation on a timely basis, refine relevant policies, explore and study specialized legislation on the application of new technologies, strengthen risk analysis and forward-looking research, and establish effective regulatory systems and rules in various fields of technology application.

Third, we need to improve the oversight mechanism. The oversight of new technologies and applications involves many subjects, making the situation complex and fast-changing. We should promote establishing a comprehensive, multi-tiered, and multifaceted system to regulate all stages, from start to finish, in all sectors. We need to put in place a multifaceted and comprehensive oversight system featuring coordination across different levels while actively exploring new types of supervision mechanisms.

Fourth, we need to innovate the means of oversight and supervision. Differential and tiered supervision shall be carried out according to the characteristics of new technologies and applications featuring dynamic changes, cross-sectoral integration, etc. We need to improve tiered regulatory tools and comprehensively use regulatory measures such as access permits, technology registration, and dynamic assessments to limit the risks brought about by technological development to an appropriate range. We need to leverage technology to control technology, use the new generation of information technology to improve and innovate existing regulatory tools, and make our regulation more digital and smarter. Thank you.

Hong Kong Bauhinia Magazine:

The public is both an audience and a participant in enhancing public awareness of laws on the internet. How can we fully mobilize the public to participate in raising public awareness of the law? Thank you.

Wang Xiaoguang:

Thank you for your question. This is a very good question. We know that China has the largest number of internet users in the world. Raising public awareness of the law requires a people-centered approach. Wherever the people are, promoting public awareness of the law must be followed up, and the work of increasing legal awareness must be extended. The internet has become the main battlefield for promoting legal awareness and has also become the largest growth area for raising legal awareness. Since the eighth five-year plan for increasing public knowledge of the law, we have firmly put the people at the center of our work of law popularization, paid more attention to using cases to explain the law around issues that the people are concerned about, and attached more importance to harnessing the advantages of online legal education, such as its broad-based participation, strong interaction, immediacy, and better services. The one-way publicity has been transformed into interactive, service-oriented, and scene-based communication. The public is no longer just a passive audience, but rather active participants, supporters, and advocates. We have realized that the vast potential for promoting legal awareness lies wthin the people and in cyberspace. Here, I will give two examples.

The first example is the MOJ's WeChat account called "China Law Popularization," which organizes special quizzes on China's Constitution and the Civil Code during important periods such as the Constitution Publicity Week and the Civil Code Publicity Month every year. In 2022, more than 1.7 billion entries were received. The WeChat account interacted with netizens and organized activities such as selecting selected comments from netizens, "My Offer for Law Popularization," and red envelopes for answering questions during the Spring Festival. Improving public participation and experiences increases people's satisfaction and happiness. Currently, the WeChat account is organizing a quiz about the Criminal Law, and all interested friends are welcome to participate.

The second example is that the MOJ and the National Office for Law Popularization have, in conjunction with the Publicity Department of the CPC Central Committee and the CAC have held legal-themed comic and micro-video collection and promotion activites for 18 sessions. The event has widely motivated internet users to innovate and collect their works online, of which the award-winning ones are exhibited and broadcast online. These works, created by internet users, are in turn used to educate them, which is coming from the public and going back to them. I think this vividly embodies the online mass line of public legal education for a new era. Thank you. 

China Daily:

The white paper released today mentions that China's law-based internet governance has developed into one with Chinese characteristics. We also noticed that China has introduced Cybersecurity Law, Data Security Law, Personal Information Protection Law, and other laws in recent years. Does this mean that China is competing with other countries and regions for discourse power in making cyberspace governance rules and promoting the Chinese internet model? Thank you.

Cao Shumin:

Thank you for your question. It is of public attention, and I will answer it. 

The rule of law is one of the important achievements of human civilization. It has become a global consensus to advance cyberspace development and governance with law-based thinking, mindsets, and approaches. At the same time, given the different national realities, political systems, and cultural backgrounds countries have, each country is entitled to choose a suitable path of internet governance and development. China's law-based internet governance has always been based on our national context that China is the world's largest developing country with the largest number of internet users. China's law-based internet governance has actively adapted to the trend of the information age, widely drawn from the advanced experience and mature practices of other countries in law-based cyberspace governance, and pioneered a distinctive Chinese model in line with international best practice, embarking on a road of law-based internet governance with Chinese characteristics. 

China's development of the rule of law has drastically increased its capacity in internet governance, which has ensured fast, sound, and orderly internet development in the country and contributed Chinese ideas and solutions to global internet governance. Countries around the world, boasting varied and distinctive variations on rule of law for their populations, should and can find a suitable path for the development and governance of the internet. "A single flower does not make spring, while one hundred flowers in full blossom bring spring to a garden." We will adhere to the guiding principles by General Secretary Xi Jinping on building a community with a shared future in cyberspace and take law-based cyberspace governance as a vital guarantee for advancing transformation of the global internet governance system and building a community with a shared future in cyberspace. We will respect sovereignty in cyberspace and revere other countries' rights to independently choose their own internet development path and governance model as well as the right to equally participate in global cyberspace governance. We will strengthen international exchanges and cooperation in law-based internet governance and work with the international community to relentlessly explore effective ways through which the internet can better benefit the people. We will make more influential, distinctive, and effective achievements in practicing the rule of law so as to actively contribute to build a cyberspace featuring justice and fairness, openness and inclusion, security and stability, and vigor and vitality.

Xing Huina:

Today's press conference is hereby concluded. Thanks to all the speakers and friends from the media. Goodbye. 

Translated and edited by Zhu Bochen, Gong Yingchun, Liu Jianing, Xu Kailin, Yuan Fang, Zhang Rui, Yan Xiaoqing, Qin Qi, Wang Yiming, Xiang Bin, Yan Bin, Xu Xiaoxuan, Wang Wei, Ma Yujia, Wang Yanfang, Liu Sitong, Zhang Junmian, He Shan, Liu Qiang, Li Huiru, David Ball, Tom Arnsten, and Jay Birbeck. In case of any discrepancy between the English and Chinese texts, the Chinese version is deemed to prevail.

Read in Chinese

Speakers:

Mr. Zhao Chenxin, vice chairman of the National Development and Reform Commission (NDRC)

Mr. Li Chunlin, vice chairman of the NDRC

Mr. Yang Yinkai, vice chairman of the NDRC

Chairperson:

Ms. Shou Xiaoli, director general of the Press Bureau of the State Council Information Office (SCIO) and spokesperson of the SCIO

Date:

March 6, 2023

Shou Xiaoli:

Ladies and gentlemen, good morning. Welcome to this press conference held by the State Council Information Office (SCIO). This is the 10th briefing in the series "Embarking on the New Journey — A Government Perspective." We are honored to have invited Mr. Zhao Chenxin, vice chairman of the National Development and Reform Commission (NDRC); Mr. Li Chunlin, vice chairman of the NDRC; and Mr. Yang Yinkai, vice chairman of the NDRC, to brief you on promoting high-quality development to set the stage for building a modern socialist country in all respects, and take your questions.

Now, I'll give the floor to Mr. Zhao Chenxin for a brief introduction.

Zhao Chenxin:

Friends from the media, good morning. It is a pleasure to attend today's press conference with my two colleagues and speak with you. First of all, on behalf of the NDRC, we would like to take this opportunity to express our heartfelt thanks to friends from the press and all walks of life for their long-term care, support and assistance regarding the development and reform work.

Over the past year, China has encountered various challenges, including a turbulent global environment, and the complex and demanding domestic reform, development and stability agendas. However, with the strong leadership of the Central Committee of the Communist Party of China (CPC) with Comrade Xi Jinping at its core, our nation has responded effectively to these uncertainties and achieved remarkable progress in economic and social development. We have basically met our primary objectives and tasks for the year. Yesterday, the Report on the Implementation of the 2022 Plan for National Economic and Social Development and the 2023 Draft Plan for National Economic and Social Development, drafted under the efforts led by the NDRC, was submitted for review to the first session of the 14th National People's Congress (NPC) and members of the Chinese People's Political Consultative Conference (CPPCC). The report presents a comprehensive overview of the implementation of the 2022 national economic and social development plan, and a summary of the previous year's performance can be condensed into a few key points. The first noteworthy point is the overall strong performance of the economy. We reached a new level of GDP at 120 trillion yuan, which was an increase of 6.1 trillion yuan, equivalent to the annual GDP of a medium-sized country. Despite global inflation hitting a new four-decade high, China's consumer price index (CPI) only rose by 2%. China created 12.06 million new urban jobs in 2022, exceeding the government's annual target, and our balance of payments maintained a basic equilibrium. By the end of last year, our foreign exchange reserves exceeded $3.1 trillion. Overall, China's economy has performed exceptionally well among major economies. Achieving such remarkable progress amid numerous uncertain factors is a significant accomplishment that we should cherish. The second point is the steady improvement in the quality of our development. Innovation has played a vital role in leading our progress, and for the first time, China's investment in research and development (R&D) surpassed 3 trillion yuan, with the proportion of GDP rising to 2.55%. Our ranking in the global innovation index rose to 11th place. We have accelerated the pace of structural adjustments in various fields, such as industries, regions, investment, consumption and trade, while also promoting green, circular and low-carbon development. Additionally, we have also consolidated our gains in poverty elimination, improved the social security system, and enhanced the level of public services. Lastly, we have continued to consolidate the foundation of our secure development. Fiscal and financial operations remain stable, and our balance of payments is sound, providing a crucial foundation for our safe development. Grain production has achieved "19 consecutive bumper harvests," with a stable output of over 650 million metric tons for eight consecutive years. The building of the energy production, supply, storage and marketing system has accelerated, and the overall energy supply has been stable. The security and guarantee capabilities of important industrial and supply chains have been continuously improved.

The achievements during the year can also be viewed in a longer time frame, which can provide a more comprehensive, profound and objective understanding of our country's progress. Looking back over the past five years, it has been an exceptionally unusual and extraordinary period for our country. During this time, our nation has consistently adapted to the global and domestic situations, social conditions and public opinion to promote economic and social development. We have effectively and efficiently responded to multiple challenges, including the accelerating changes unseen in a century, the impact of the COVID-19 pandemic, and the domestic economic downturn. As a result, we have achieved an average annual economic growth rate of 5.2%, significantly higher than the global growth rate of around 2.3% over the same period. China's position as the world's second-largest economy, largest manufacturing country, and largest trader in goods has been further consolidated and improved. We have also made sustainable and healthy progress in various undertakings, resulting in a significant improvement in the people's sense of gain, happiness and security. Especially in the past three years, under the strong leadership of the CPC Central Committee with Comrade Xi Jinping at its core, we have achieved major and decisive victories in epidemic prevention and control. Furthermore, looking at the last 10 years in the new era, the country has achieved historic achievements and undergone historic changes in economic and social development. It was a decade marked by a turn toward high-quality development. The economic output of China has continuously surged to new heights, and its contribution to world economic growth ranked first. In particular, we have secured a historic success in eradicating absolute poverty, achieving a miracle in humankind's history of poverty reduction. We have built a moderately prosperous society in all respects on schedule, providing a more comprehensive institutional guarantee, a more solid material foundation, and a more vibrant spiritual force for Chinese modernization.

This year marks the first year of implementing the guiding principles of the 20th CPC National Congress, a crucial juncture to implement the 14th Five-Year Plan (2021-25), and an important period to lay the foundation for building China into a modern socialist country in all respects. Therefore, it is of great significance to ensure economic performance. We will uphold the guidance of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, fully implement the guiding principles of the 20th CPC National Congress and the Central Economic Work Conference, and follow a unique Chinese path to modernization. We will adhere to the general principle of pursuing progress while ensuring stability, fully and faithfully apply the new development philosophy on all fronts, accelerate the creation of a new development pattern, and work hard to pursue high-quality development. We will better balance both domestic and international situations, coordinate epidemic prevention and control with economic and social development, and development with security. We will comprehensively deepen reform and opening up to strongly boost market confidence. We will make sure that our implementation of the strategy to expand domestic demand is integrated with our efforts to deepen supply-side structural reform. We will make more efforts to stabilize economic growth, employment, and prices and effectively fend off and defuse major risks. We will strive to achieve an overall upturn in economic performance and effectively upgrade and appropriately expand China's economic output. We will continue to improve the people's well-being and ensure social stability, making sure our efforts to build a modern socialist country in all respects get off to a good start and making new and greater contributions with our concrete actions.

That's my introduction. Next, my colleagues and I would like to answer your questions.

Shou Xiaoli:

The floor is open for questions now. Please identify the media outlet you represent before raising questions.

China Media Group:

Since the beginning of this year, China's economy has continued to recover, with a bump in both investment and consumption. Will such economic recovery continue in the future? What do you think of the 5% annual GDP growth target ? What measures will the NDRC take to help achieve such a goal? Thank you. 

Zhao Chenxin:

Thank you for your questions. Your questions cover three specific issues: whether the economy will continue its recovery, how to comment on the growth target of around 5%, and what measures will be adopted to help achieve the goal. I will answer them one by one.

Over the past three years, China has fought an extraordinary battle against COVID-19. Our practices have fully demonstrated that the Party Central Committee's major judgments on the pandemic, major decisions on pandemic-related work, and major adjustments to response strategies were appropriate. Its effective measures have been recognized by the people and helped deliver great effects. Under the strong leadership of the Party Central Committee with Comrade Xi Jinping at its core, China has achieved major decisive success in preventing and controlling the COVID-19 pandemic. At present, indeed, as you mentioned, as COVID-19 response measures have been improved and adjusted, and policies have been implemented effectively, leading to an accelerated resumption of transportation and logistics, and a steady improvement in economic operation. You also mentioned consumption and investment. We have seen sound momentum in consumption since the Spring Festival. Consumption related to tourism, transportation, restaurant, and retail services has increased substantially, laying a solid foundation for the first quarter of 2023 and even the entire year. From the perspective of investment, a host of major projects have started across the country recently. Measure, such as policy-backed and developmental financial instruments, medium- and long-term lending to the manufacturing sector, and equipment upgrading in key areas, have effectively ensured that projects are bolstered by funds and production factors. Such efforts have provided strong support to the economic recovery. All of the above have fully proved that China's economy has strong resilience and enormous potential, and the sound momentum for its sustainable and healthy economic growth has been maintained. Moreover, the fundamentals of China's economy remain unchanged, and they will maintain long-term growth. 

We can view the annual growth target of around 5% from three aspects. First, China remains a developing country with development high on its agenda. We need to keep long-term economic growth within a proper range on the basis of improving the quality and effectiveness of the development so as to achieve the targets and fulfill the tasks set at the 20th CPC National Congress. Meanwhile, we also need to maintain a certain growth rate to promote and expand employment, improve people's well-being, and fend off and defuse risks. Second, the target of around 5% is in accordance with economic development trends and the law of economic development. It is also conducive to guiding all sectors of society to put more focus on improving both the quality and the efficiency of economic growth so as to accelerate the building of the new development paradigm and promote high-quality development. Third, local governments have shown confidence in growth and have geared up for development. Moreover, people's congresses at the local level have made their economic growth target for this year. Based on our statistics and analysis, 27 of China's 31 provinces, regions, and municipalities directly under the central government have set a growth target higher than the national one, with 23 provinces aiming at 5.5% or above. Their strong confidence and practical measures have contributed to favorable conditions and laid a solid foundation for realizing the growth target of the country.

The third question is, what measures should be taken? The Central Economic Work Conference has laid out a comprehensive plan for this year's economic work. The next step is to work with other stakeholders to take substantial and meaningful measures to implement those decisions and arrangements of the Party Central Committee. Generally speaking, the overarching goal is to achieve both stability and progress, firmly implement the guidelines on better coordination in six aspects emphasized by General Secretary Xi Jinping at the Central Economic Work Conference, and prioritize stabilizing growth, employment and prices. Specifically, we should focus on the following five priorities. First, we will intensify our macro-policy control and regulation, ensuring that policies are consistent, coordinated, effective, and targeted; increase linkage and coordination between various policies; and conduct evaluations to ensure their consistency with the direction of macro-policies. Last year, under the arrangements of the CPC Central Committee and the State Council, we successfully conducted consistency evaluations and achieved positive outcomes. This year, in accordance with the requirements of the CPC Central Committee and the State Council, we will do a better job in this consistency evaluation based on our experiences to ensure policies form synergies and work together effectively to achieve our targets. Second, we will coordinate our efforts to expand domestic demand with the deepening of supply-side structural reform to fully unleash the potential for consumer spending. We will also promote investment to achieve substantial progress, intensify our work in implementing the innovation-driven development strategy, accelerate the development of a modern industrial system, and meet, lead, and create new demands through higher-quality products and services. By doing so, we aim to promote a virtuous cycle of supply and demand at a higher level. Third, we will work towards building a more advanced socialist market economy system and further enhance our level of openness to continually stimulate development momentum and vitality. Fourth, we will coordinate development and security, prudently handle and resolve risks in areas such as real estate, finance, local government debts, and effectively enhance our security capabilities in fields such as grains, energy resources, and major industrial and supply chains. Fifth, we will implement solid and targeted employment-first policies, strengthen basic public services, and continuously safeguard and enhance people's livelihoods. Meanwhile, we will further enhance economic monitoring, predictions, and early warning, conduct early policy analyses before their implementation, enrich policy tools, prepare for worst-case scenarios, and be better equipped to address complex and difficult situations. We will maintain a firm hold on the initiative in our work and promote overall improvements in economic performance.

That concludes my remarks. Thank you.

Cover News: 

Despite the soaring inflation rates worldwide, China's consumer prices remained generally stable last year. How do you view the situation of China's consumer prices this year? What measures will be taken to stabilize prices?

Li Chunlin:

I'm happy to answer your questions. In 2022, amidst staggering inflation rates not seen in many years and increasing pressure for imported inflation, various localities and relevant departments have taken forceful and effective measures to ensure the supply of major products and stabilize their prices, with a focus on grain and energy. They have resolutely implemented the decisions and arrangements of the CPC Central Committee and the State Council and achieved remarkable success. Domestic prices have remained stable, with the monthly CPI consistently kept below 3% and the annual CPI at only 2%. This has demonstrated a stark contrast to the soaring inflation rates seen worldwide.

Due to various factors such as geopolitical conflicts and pressures from imported inflation, domestic prices in China face several uncertainties and instabilities. However, it is important to note that China has achieved a bumper harvest in grain output for 19 consecutive years, with total output exceeding 1.3 trillion jin for many years, which provides a solid foundation for the country to maintain stable prices. Furthermore, we have ample hog production, a sufficient supply of products, stable energy sources, and an improved system to ensure supply and stabilize prices. It is fair to say that China has a solid foundation to stabilize prices, and we are confident in our capacity to meet this year's CPI target.

The Central Economic Work Conference highlighted the importance of stabilizing growth, employment and prices. Looking ahead, we will firmly implement a range of decisions and arrangements aimed at stabilizing prices made by the CPC Central Committee and the State Council, with particular attention to the following four areas: First, we will strengthen monitoring, prediction, and early warning. This requires close monitoring of both domestic and international commodity markets as well as the markets for major products that impact people's livelihoods. It is essential to analyze and predict changes in supply and demand and price fluctuations and implement targeted regulatory measures in a timely manner. Second, we will further strengthen our efforts in guaranteeing supply and stable prices for products affecting people's livelihoods. We will fully implement the national strategy for food security and the system of city mayors assuming responsibility for the "vegetable basket," stabilize the supply of output, improve links between production and sales, regulate food reserves, and ensure a stable market supply of these products. Third, we will take further steps to ensure supply and stable prices for major commodities such as energy. We will stabilize coal production, enhance our reserve capacity, and continuously regulate coal prices to ensure they are within an appropriate range. Furthermore, we will continue to increase exploration and development of China's oil, gas, and mineral resources; expand reserves and output; and strengthen the country's supply capacity. Fourth, we will also strengthen market regulation and guidance over expectations. This will involve coordinated efforts to regulate both spot trading and the future market. We will crack down on illegal activities such as hoarding and price gouging that violate laws and regulations. In addition, we will improve policy interpretation and press releases and promptly address public concerns. Thank you.

Phoenix TV: 

Last year, China's economic growth came in at 3%, while U.S. economic growth reached 2.1%. However, many analyses showed that the increment of the U.S.' GDP was larger than China's, and the gap between China and U.S. in economic aggregate was widening. How do you view these changes? Thank you.

Zhao Chenxin:

Thanks for your question. It's an important question that you have raised. The question also reminds us that many friends may have some questions when looking at the relevant data. I would like to make a few points for your reference regarding your question.

First, I want to stress that China has made remarkable progress in ramping up economic and social development in 2022 despite the impact of multiple unexpected factors. I summed it up in three sentences at the beginning of the conference: the overall performance of China's economy was very impressive, the quality of development has been steadily improved, and the foundation for safe development has been consolidated. Meanwhile, taking multiple economic indicators into overall consideration, the performance of China among the world's major economies was very outstanding. If we look at the longer time span of five or ten years, we can take a comprehensive and in-depth look at last year's achievements. The outstanding comprehensive performance highlights the quality and level of our country's economic development.

Second, when reading and observing economic data, we need to analyze the precise meaning of these data. Last year, China's economic growth came in at 3%, while U.S. economic growth reached 2.1%, and some other major economies grew by around 1.9% or less than 1%. This data was calculated using constant prices, which can reflect the growth of an economy relatively objectively and accurately. However, regarding the comparison of total GDP between China and the U.S., all countries use nominal GDP calculated at the current price of their own currencies when calculating the total GDP, which are prone to be heavily impacted by commodity prices. Last year, the U.S. experienced elevated inflation, with CPI and PPI recording a year-on-year increase of 8% and 16.5%, respectively. However, China's commodities price remained stable last year as CPI and PPI increased by 2% and 4.1% year-on-year, respectively. The high inflation in the U.S. has largely raised the country's nominal GDP. Whether Americas can feel a sense of gain under the high inflation, I assume that the residents of the country have the most experience. The comparison between China-U.S. GDP aggregate should be calculated after adjusting China's GDP from yuan to U.S. dollars, in which the exchange rate plays a significant role in impacting the final numbers. To curb high domestic inflation, the Federal Reserve resorted to seven interest hikes by 425 basis points, raising the federal funds rate to the highest level since 2007, which also caused a passive depreciation of many other currencies. The increase in U.S. dollar interest rates has caused depreciation of other currencies against the U.S. dollar, and the renminbi exchange rate has also been affected to some extent. When considering the gross GDP scale, there has also been a certain degree of reduction. I provide this information for your reference so that you can analyze the precise meaning of economic data when you read and observe it.

Third, China pursues a people-centered approach to development, and the purpose of China's development is to benefit the people. We have always been committed to running our own affairs well, constantly improving and surpassing ourselves to build a better China. We have always been committed to delivering better lives for our people through development and making more and more contributions to world peace and development through China's development. As the world's largest developing country, with a population of more than 1.4 billion, the fact that China has focused on completing its own tasks is a major contribution to human development. We have upheld a mutually beneficial and win-win opening strategy, actively participated in economic globalization, and strived for the common development of all countries. We are willing to make new contributions to world economic development with the new achievements of China's development. We also reach out our arms and welcome other countries aboard the express train of China's development.

Fourth, China's economy is currently operating well on the whole. Many international institutions have recently raised their expectations for China's economic growth. This year is a very important year and the first year to fully implement the guiding principles of the 20th CPC National Congress. Accomplishing the work for economic and social development this year is of major significance. All of us throughout the country have a high degree of agreement on this issue. All regions and all government departments have taken solid, practical, and effective measures. We are confident in achieving this year's targets and advancing the rejuvenation of the Chinese nation on all fronts through a Chinese path to modernization. Thank you.

Lianhe Zaobao:

The contribution of consumption to China's economy shrank significantly last year. China's top leaders emphasize giving top priority to restoring and expanding consumption. How do you assess the current consumption situation in China? What measures will the Chinese government take to boost consumption? Thank you.

Li Chunlin: 

I am glad to answer your questions. You've raised three questions. How to evaluate the current consumption situation in China? What are the unfavorable factors restricting consumption? And what measures will be taken to boost consumption?

Final consumption is the enduring driving force for economic growth. Overall, China's consumer market has shown a trend of rapid recovery. With increasingly frequent regional population flows, there has been a significant increase in cross-provincial travel and tourism. Catering, culture, entertainment and other industries have picked up rapidly. And with the impact of traditional Chinese holidays, including the Spring Festival and the Lantern Festival, China's consumption got off to a good start at the beginning of the year. I'll share the statistics. During the Spring Festival, domestic tourism revenue reached 375.8 billion yuan, up 30% year on year, and 308 million domestic tourist visits were made, up 23.1% from last year. These two numbers are equal to 73% and 89% of the same period in 2019, respectively. Sales revenue of China's consumption-related sectors rose by 12.2%, and online retail sales of physical goods increased by 14.5%. So, judging from the numbers seen during the Spring Festival, the recovery of consumption has accelerated since the beginning of the year. As uncertainties restricting the release of consumption are gradually eliminated and consumption potential is unleashed rapidly, the growth rate of major indicators in the consumption sector is expected to increase gradually in the first half of this year. Looking ahead to the whole year, consumption can also become the main driving force of economic growth and play a more fundamental role. This is a prediction for the consumption situation of this year.

The Central Economic Work Conference emphasized that the recovery and expansion of consumption should be given top priority. As Mr. Zhao Chenxin mentioned, last year's Central Economic Work Conference stated that stability should be taken as the priority, and progress should be made while stability is ensured. Moreover, growth, employment and prices should also be stabilized. Consumption has played a fundamental role and made a key impact on stabilizing growth.

In the next step, we will fully implement the guiding principles of the 20th CPC National Congress and the Central Economic Work Conference, and promote the sustained recovery and expansion of consumption. Our work will focus on the following four aspects.

First, we will take multiple measures to promote the steady growth of consumption. We will issue policies for the recovery and expansion of consumption. We will introduce practical and effective policies and measures to stabilize bulk consumption, increase services consumption, expand rural consumption, and create a safe consumption environment to release residents' consumption potential.

Second, we will enhance the consumption capacity of residents. Consumption capacity is based on employment and income. We must come up with an innovative mechanism to promote a full-chain, virtuous cycle of employment, income distribution, and consumption. We will increase the income of urban and rural residents through multiple channels, and work to ensure the supply of basic consumer goods and keep their prices stable, so that residents can consume with stable incomes and have the confidence to spend.

Third, we will improve the consumption environment. We will develop the consumption promotion system and mechanisms, formulate polices to create a safe consumption environment, improve the quality management system, and optimize the diversified settlement mechanism for consumption disputes and the mediation mechanism for online consumer disputes. We will continue to optimize the consumption environment so that people will have a stronger sense of gain and are more willing to consume.

Fourth, we will foster new areas for consumption growth. We will vigorously advocate green consumption and new types of consumption. We will support consumption in key areas such as housing improvement, new energy vehicles, elderly care services, education, medical care, culture, health and sports. We will encourage the development of new forms, models and scenarios of consumption to further stimulate the vitality of the consumer market.

Over the coming year, we will adopt various policy tools to deal with the unfavorable factors restricting consumption. We have the confidence and capability to implement measures to boost consumption so that consumption will contribute more to the annual GDP growth of around 5% this year. Thank you.

Bloomberg: 

Investment last year was a key driver of economic growth, but local government finances are seeing increasing stress because of the cost of COVID zero and the housing slump. What's your estimate for infrastructure investment this year? And based on the information we have, are there enough quality projects qualified to use that 3.8 trillion yuan quota for local special government bonds? Thank you.

Yang Yinkai:

Thank you for your questions. Last year, in accordance with the decisions and arrangements of the CPC Central Committee and the State Council, the NDRC worked together with relevant parties to actively expand effective investment. In 2022, China's fixed-asset investment increased by 5.1% year on year. Infrastructure and manufacturing investment grew by 9.4% and 9.1%, respectively, playing an important role in stabilizing the overall macroeconomic market.

This year, we will fully implement the guiding principles of the 20th CPC National Congress and the Central Economic Work Conference. We will continue to expand effective investment and make solid progress on major projects. We will effectively drive investment of the whole society through government investment and policy incentives. We will consolidate the sound momentum of steady growth in infrastructure investment and manufacturing investment and enhance the key role of investment in improving the supply structure. We will focus on the following four aspects.

First, we will focus on weak links and accelerate construction in key areas. We will implement the 102 major projects listed in the country's 14th Five-Year Plan (2021-25) in an orderly manner. We will strengthen food security, energy security, and the security of industrial and supply chains. We will accelerate the construction of major infrastructure in transportation, water conservation, energy and other fields. We will also strengthen investment in manufacturing and high-tech industries and develop a systematic layout for new infrastructure. Moreover, we will accelerate the renovation of aging urban gas pipelines, address urban waterlogging, and promote social programs regarding people's livelihoods.

Second, we will give full play to the role of a package of investment policies and advance the development of major projects in a coordinated way. We will adhere to the requirement that projects follow their planning and that investment funds and other production factors stay with the projects they are allocated to. We will fully use our experience and actions in promoting the coordination mechanism for key projects of effective investment and continue to improve and expand the long-term working mechanism for effective investment. According to the report from the State Council on the execution of the central and local budgets for 2022 and on the draft central and local budgets for 2023, as well as the draft central and local budgets for 2023 submitted to the first session of the 14th National People's Congress for deliberation yesterday, investment from the central government budget will reach 680 billion yuan this year. Next, we will further improve the investment mix and pool all resources to accomplish major tasks and deal with difficulties and emergencies at the national level. We will organize relevant authorities to prepare for special-purpose bond projects for local governments, urging local governments to accelerate the issuance and use of special-purpose bonds, and kick-start and advance the projects. We will continue to accelerate the creation of policy-based and developmental financial instrument projects, which began last year, and make efforts to do much more work.

Third, we will build up the number of investment projects in reserve and continue to raise the quality of preliminary work for investment projects. We will guide local governments to keep building up a reserve of major projects securing both short-term and long-term benefits to lay the foundation for expanding effective investment. We will urge local authorities to launch in-depth preliminary research and demonstration for projects, effectively improving the quality and efficiency of preliminary work for projects. We will coordinate with relevant authorities to strengthen the support of land use, environmental protection assessments, and other factors of production.

Fourth, we will further stimulate private investment and continue to improve the investment environment. We will establish and enhance the mechanism of private investors' participation in the development of major projects. We will fully use the mechanism for facilitating cooperation on investment and financing of nongovernmental capital to encourage more private capital to get involved in developing major national projects to strengthen areas of weakness. We will promote advanced experience and earnestly implement the policy documents supporting the development of private investment. We will guide private capital to use idle assets in various ways and promote high-quality private investment projects to issue infrastructure REITs.

Concerning your question about special-purpose bonds for local governments, special-purpose bonds have now become important sources of funding for construction projects of local governments. According to the arrangement and requirements of the State Council, next, we will take practical measures to fulfill the duties of establishing criteria for investment and screening projects. We will guide local authorities to continue to plan for and build up a reserve of special-purpose bond projects. Rolling groups of projects will be applied and launched one after another. We will tighten the review of projects and urge local authorities to follow the principle that investment funds and other production factors stay with the projects they are allocated to and choose projects from a list of projects in reserve we have screened and established for bond issuance. I would like to emphasize that all projects included in the list of projects in reserve are infrastructure and public service projects that conform to planning, are led by governments, will be launched sooner or later, and have certain benefits. Meanwhile, in addition to the bond issuance in the areas of transport, energy, agriculture, forestry and water conservancy, social programs, utilities and industrial parks, and new types of infrastructure, we will follow the decisions and arrangements of the Party Central Committee and the State Council and work with relevant authorities to actively explore and further expand the areas for the issuance of special-purpose bonds. Thank you.

Xinhua News Agency:

This has been the third year since the implementation of the outline of the 14th Five-Year Plan. During the process of implementing the previous five-year plans, the mid-term assessment was conducted. Can you provide an update about the progress of the mid-term assessment this year? Thank you.

Yang Yinkai:

Thanks for the attention of all sectors of society to the mid-term assessment of the implementation of the 14th Five-Year Plan. This year is crucial to continuing to implement the 14th Five-Year Plan. The mid-term assessment is of great significance for promoting the smooth implementation of the 14th Five-Year Plan. According to the Law on Supervision by the Standing Committees of the People's Congresses at All Levels and arrangements of the CPC Central Committee and the State Council, we are working with relevant departments to carry out the mid-term assessment of the 14th Five-Year Plan. We will comprehensively review the progress in implementing the 14th Five-Year Plan, thoroughly analyze the difficulties and challenges, and put forward upcoming targeted policies and measures to further implement the 14th Five-Year Plan.

In terms of the scope of assessment, the mid-term assessment mainly includes three aspects, i.e., the implementation of the outline of the national 14th Five-Year Plan, the implementation of special plans at the national level, and the implementation of local 14th five-year plans. Concerning the implementation of the outline of the national 14th Five-Year Plan, the mid-term assessment is led and placed under the responsibility of the National Development and Reform Commission and supported by other relevant departments performing their respective functions. Departments that have formulated the plans are responsible for the mid-term assessment of the implementation of the special plans at the national level. Concerning the implementation of local 14th five-year plans, the mid-term assessment is led and placed under the responsibility of the local development and reform commissions.

Regarding the key assessment areas, the mid-term assessment focuses on the macro, meso and micro levels. It comprehensively reviews major objectives and indicators, the promoting of high-quality development, major strategic tasks, major projects and changes in the conditions facing development. At the same time, we will step up innovation in the subjects, methods, processes and assessment criteria. We will take practical measures to ensure that the assessment combines self-assessment with third-party assessment and comprehensive assessment with thematic assessment. It adopts objective- and problem-oriented approaches, assesses both process and effect, and combines standard assessment with customized assessment and objective assessment with subjective experience.

Previously, we officially released a notice asking relevant departments of central and state organs and local development and reform commissions to conduct self-assessments simultaneously. At the same time, we will entrust relevant institutions to carry out a series of thematic research and third-party assessments based on actual circumstances. At present, all our work is progressing in an orderly manner.

Next, we will conduct in-depth research and studies, solicit opinions from all parties, and make a comprehensive, accurate and objective assessment of the progress of implementing the 14th Five-Year Plan. We will make every effort to promote the implementation of major objectives and tasks in an orderly manner to get off to a good start in advancing Chinese modernization. Thank you.

CRNTT:

Due to significant fluctuations in the global food market in recent years, food security has become an issue of common concern to all parties. How do you perceive China's food security at present and in the following period, and how to ensure food security in a large country with a population of over 1.4 billion? Thank you. 

Zhao Chenxin:

Thank you for your question. It's quite an important one. Just now, Mr. Li mentioned food security when taking other questions. Now, I will give you a detailed introduction. 

Food security concerns the country's most fundamental interests. General Secretary Xi Jinping has reiterated that we must always have control over our own food supply and fill the rice bowl of Chinese people mainly with Chinese grain. In recent years, uncertain and unpredictable factors have been intertwined worldwide, and the global food market has encountered frequent and substantial fluctuations. We have earnestly implemented the decisions and plans of the CPC Central Committee and the State Council with relevant parties and ensured stable domestic grain production and supply in response to the uncertainty of the external environment. The domestic food market has maintained a sound momentum of ample supply and stable operation. Last year, in the face of unexpected factors such as a prolonged COVID-19 pandemic and extreme weather, with joint efforts from all parties, China saw a bumper grain harvest with a record-high output of 686.55 million metric tons. It was the eighth consecutive year that the grain output exceeded 650 million metric tons. We also achieved notable results in expanding the plantation of soybean and oil crops, carried out grain purchases in a steady and orderly manner, and significantly improved our logistics and emergence response capabilities. In general, China has a solid foundation in ensuring grain supply and stabilizing prices as bumper grain harvest continued for many straight years. With the constant improvement of market regulation, a secure and reliable logistics system, a relatively high level of stock, and an enhanced ability to respond to severe natural disasters and public emergencies, China has delivered a good job in ensuring food security. Our food supply can meet people's daily consumption needs and the need to develop relevant industries. 

As China has a population of over 1.4 billion, ensuring food supply always remains a top priority in the governance of the country. We must never relax our efforts to ensure national food security. Following Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, we will implement the food crop production strategy based on farmland management and technological application, and uphold the national strategy on food security featuring self-sufficiency based on domestic grain production, guaranteed food production capacity, moderate imports, and technological support. We will take comprehensive measures concerning all links of grain production, purchase, storage, processing, and sales, and coordinate to enhance our abilities to produce, transport, and store grain so as to consolidate the all-rounded foundation of food security. On the one hand, we will make every effort to increase grain production. We will see that the Party and the government will be equally responsible for food security and arable land protection, and improve policies to support major grain-producing areas, major areas of grain sales, and balanced areas of grain production and sales, in a bid to ensure stable grain acreage. We will launch a new round of actions to increase China's grain production capacity by 50 million metric tons and continue to advance projects to improve soybean and oil production capacity. We will invigorate the seed industry and accelerate breakthroughs in key and core agricultural technologies. On the other hand, we will make every effort to safeguard market supply. We will continue to improve our ability to regulate grain harvest and storage, enhance the balance of grain production and consumption as well as market regulation, and deliver a good job in grain purchases. We will enhance the construction of grain storage and logistics facilities and make good arrangements for the sale of excess grain stockpiles. Continued efforts will be made to optimize a national grain emergency response system. In a word, we have the foundation, conditions, abilities, and confidence to safeguard a secure food supply for Chinese people. We will speed up building a national food security system that is higher-level, higher-quality, more efficient, and more sustainable, providing strong support for the stable and sound development of the economy and society. Thank you. 

CNBC: 

I have two questions. First, what are this year's new plans for attracting foreign investment, and in which sectors specifically? Second, the unemployment rate of young people and college graduates was relatively high during the pandemic. What are this year's employment trends, and what policies are going to be released to support employment? Thank you. 

Zhao Chenxin:

Let us invite Mr. Li to answer the question about employment and Mr. Yang about the utilization of foreign investment. 

Yang Yinkai:

I will answer your question about the utilization of foreign investment. In 2022, China achieved fruitful results in attracting foreign investment. Overall, we saw the quality of foreign investment in China improving amid a steady growth, and three new changes emerged in this regard. First, the quality of foreign investment in China continued to improve, with the actual use of foreign capital in manufacturing and high-tech industries up by 46.1% and 28.3%, respectively. Second, sources of foreign investment were more diversified. Investment from the EU and countries along the Belt and Road increased by 92.2% and 17.2%, respectively. Third, the regional distribution of foreign investment tended to be more balanced. The actual use of foreign investment in China's central and western regions grew by 21.9% and 14.1%, respectively. In January 2023, foreign direct investment into the Chinese mainland, in actual use, expanded 14.5% year on year to 127.69 billion yuan, getting off to a good start. The increasing foreign investment in China and its optimized structure have fully demonstrated the confidence of global investors in the country's development. 

This year, in terms of attracting foreign investment, we will further implement the decisions and plans of the CPC Central Committee and the State Council and expand institutional opening up regarding rules, regulations, governance, and standards in a steady manner. We will strive to foster a market-oriented and law-based world-class business environment to support global investors to invest in China and promote the high-quality development of our work to attract more foreign investment. We will focus on the following three aspects. 

First, we will implement the plans listed in the Outline of the 14th Five-year Plan (2021-25) and advance opening up in telecommunication, internet, education, culture, medical care, and other sectors in an orderly manner. We will further ease restrictions apart from the foreign investment negative list to ensure that foreign-invested enterprises enjoy all policies on an equal basis. 

Second, we will ensure the implementation of all policies that have been issued. We will fully implement several policies and measures focusing on the manufacturing industry to promote the expansion of foreign investment, stabilize the stock and improve investment quality. This includes the new version of the Catalogue of Industries for Encouraging Foreign Investment, guiding more foreign investment toward sectors such as advanced manufacturing, modern services, high and new technology, energy conservation and environmental protection, and toward the central, western and northeastern regions.

Third, we will enhance foreign investment promotion and services, leveraging major foreign investment projects in China to set better examples, and promoting the improvement of local mechanisms. We will work in unison between the higher and lower levels of government, and provide full-process services. We will organize and conduct a series of international industrial investment cooperation activities to create a platform for multinational companies and local investment attraction.

I would also like to emphasize that China has always been proactive in implementing high-level opening-up policies. We will encourage foreign investors to invest in the Chinese market with a more open and inclusive attitude. Global investors are welcome to invest and do business in China. They can play a greater role in building a new dual circulation development paradigm, with the domestic economy and international engagement reinforcing each other and achieving more significant progress.

Li Chunlin:

I will answer the employment question. Employment is pivotal and fundamental to people's livelihoods. The Party Central Committee and the State Council attach great importance to stabilizing employment, further implementing the employment-first policy, promoting the gradual stabilization and recovery of the employment situation, and maintaining overall stability. The report at the conference yesterday also mentioned that our goal this year is to create around 12 million new jobs, a net increase of 1 million compared to last year. We are fully confident that we will achieve this goal.

Judging from the situation this year, the external environment has become increasingly volatile and grave. The number of domestic college graduates and urban employment demand has reached new highs, and there are still some pressure and challenges to expand employment opportunities and improve employment quality. However, we should also acknowledge that the continuous efforts and effectiveness of various policies and measures aimed at ensuring stable growth, employment, and prices have taken effect. Businesses, including enterprises, continue to recover and grow, leading to an expansion of labor demand and an increase in employment opportunities, resulting in an increase in jobs and a stable and positive employment situation. Last year we set a goal of creating 11 million new jobs, but we actually achieved 12.06 million, exceeding the planned target by 1 million. This year's goal is to create about 12 million new jobs, which is 1 million more than last year's targe, fully reflecting our confidence and determination to stabilize employment.

The second question you raised about employment is regarding what kind of policies will be introduced to stabilize and maintain it. The Central Economic Work Conference clearly stated that promoting the employment of young people, especially college graduates, should be a top priority. The NDRC will firmly follow the decisions and arrangements of the Party Central Committee and the State Council, intensify our support for employment-oriented macro-regulation policies, and take well-coordinated steps toward the promotion of "job expansion, job stabilization, services, and entrepreneurship" to facilitate high-quality and full employment of young people, including college graduates. We will focus on four key aspects.

First, we will focus on expanding the market-oriented employment of college graduates. We will proactively expand effective investment, accelerate the recovery in consumption of consumer services, and expand market-oriented employment space by increasing domestic effective demand. We will encourage the manufacturing industry's high-end, intelligent, and green development, promote the deep integration of modern services with advanced manufacturing and modern agriculture, and create more knowledge-based and technical jobs. We will provide stable employment for college graduates and young people with specific technical expertise.

Second, we will focus on accelerating the efforts to ease the difficulties faced by enterprises and self-employed individuals. We will promptly adjust, optimize and effectively implement policies that alleviate burdens and difficulties, continue to reduce costs, strengthen the security of energy resources and important industrial and supply chains, promote the integration and sharing of credit information related to enterprises, enhance the financial service capabilities for MSMEs, promote the recovery and development of business entities, and improve employment absorption capacity.

Third, we will focus on strengthening employment services for young people. We will increase efforts and improve mechanisms to provide precise, efficient, and continuous employment services for college graduates, as well as provide comprehensive support for young people facing employment difficulties. We will deepen industry-education integration and school-enterprise cooperation for vocational education, promote the joint-construction and sharing of vocational skills training resources, enhance the skills of young people, including college graduates, and closely align what students have learned with market needs.

Fourth, we will focus on unleashing the vitality of youth innovation and entrepreneurship. We will give full play to the leading and serving role of the demonstration bases for innovation and business startups and promote the opening and sharing of entrepreneurial resources. We will strengthen the construction of entrepreneurial parks for people returning or moving to the countryside and guide college students interested in and capable of starting a business to return to their rural hometowns or settle in rural areas to start their own businesses. We will make a big push to develop the digital economy, enhance regular supervision, support platform enterprises to play a greater role in driving development and creating jobs, and encourage young people to rely on platforms to start their own businesses and find flexible employment opportunities. Thank you all.

The Paper:

The international energy supply and demand situation has been challenging since last year, which has exerted huge pressure to China's energy provisions. How do you view the current and future energy security situation in China? What are the NDRC's plans to ensure a stable and sufficient supply of energy ? Thanks.

Li Chunlin:

Like food safety, energy security is also a crucial part in China's national security. It is typically a "matter of national significance." In recent years, despite the complex global energy supply situation and rising prices, we have made solid progress in developing the energy production, supply, storage, and marketing systems. We have continuously enhanced our energy supply capacity, diversified our energy imports, improved reserve capacities, gradually optimized market systems, and achieved remarkable results in green and low-carbon transformation. In recent years, China's energy self-sufficiency rate has remained above 80%. In 2022, domestic crude oil production rebounded to over 200 million tons, reaching 205 million tons; natural gas output reached 220.1 billion cubic meters, increasing by more than 10 billion cubic meters for six consecutive years; by the end of 2022, the national installed power capacity registered 2.56 billion kW, among which the installed capacity of renewable energy exceeded 1.2 billion kW; and the newly installed capacity of wind power and photovoltaic exceeded 100 million kW for three consecutive years. In general, China's energy security is guaranteed.

In 2023, the international energy supply and demand situation remains complicated, with many uncertain factors, and domestic economic recovery and development drive steady growth in energy demand, while problems still exist regarding energy supply and demand between regions and periods. In order to keep the energy supply and prices stable, we will continue to reinforce systems for energy production, supply, storage, and marketing on the basis of our previous efforts and take comprehensive measures to ensure safe and stable energy supply. We will mainly focus on the following four aspects:

First, we will increase energy production and supply. We will continue to improve power supply capacity by vigorously promoting the construction of large-scale wind and photovoltaic power stations mainly in desert and barren areas, particularly in the Gobi desert. We will also develop necessary peak-shaving power sources and coordinate to increase effective power generation. We will increase investment in domestic oil and gas exploration and development to boost oil and gas reserves and production. We will stabilize coal production and supply while strengthening its clean and efficient utilization. We will also ensure the diversified and stable energy imports.

Second, we will constantly consolidate energy reserves. We will establish and improve a sound energy reserve system, bolster coal reserve capacities, and create a stable and efficient oil and gas reserve system so as to continuously enhance our capacity for backup power supplies for national emergencies and peak-shaving power sources.

Third, we will maintain stable energy prices. We will pay close attention to changes in supply and demand and the prices of the energy market and take coal as an "anchor" to ensure the supply and price stability of energy. We will take a combination of measures to regulate and supervise coal price and stabilize electricity prices by keeping coal prices stable. In this way, we will be able to maintain stable energy prices across the country.

Fourth, we will safeguard the bottom line of people's energy use. We will expand the coverage of medium and long-term contracts involving coal supply for power generation, heating, and household gas supplies. We will improve the complementarity of energy sources, including coal, natural gas, electricity, and refined oil, and enhance our capabilities to ensure peak-hour energy supplies. We will also make more efforts to strengthen the monitoring and early warning of power supply and demand. Furthermore, we will refine demand-side combined load management plans and firmly uphold the bottom line of energy use for people's livelihoods. Thanks.

Shou Xiaoli:

Thank you to the three speakers from the NDRC, and thank you to all my friends in the media. Today's press conference concludes here. Goodbye.

Translated and edited by Wang Yiming, Wang Qian, Zhou Jing, He Shan, Guo Yiming, Zhang Rui, Dong Qingpei, Yang Xi, Yan Xiaoqing, Wang Wei, Xu Kailin, Zhou Jing, Liu Jianing, Yan Bin, Zhang Tingting, Li Huiru, David Ball, Tom Arnsten, and Jay Birbeck. In case of any discrepancy between the English and Chinese texts, the Chinese version is deemed to prevail.

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Read in Chinese

Speakers:

Mr. Yi Gang, governor of the People's Bank of China (PBC)

Mr. Pan Gongsheng, deputy governor of the PBC and head of the State Administration of Foreign Exchange (SAFE)

Mr. Liu Guoqiang, deputy governor of the PBC

Chairperson:

Mr. Chen Wenjun, director general of the Press Bureau of the State Council Information Office (SCIO) and spokesperson of the SCIO

Date:

March 3, 2023

Chen Wenjun:

Ladies and gentlemen, good morning. Welcome to the press conference held by the State Council Information Office (SCIO). This is the ninth press conference in the series “Embarking on the New Journey — A Government Prospective.” We have invited Mr. Yi Gang, governor of the PBC, to brief you on forging ahead with confidence, upholding fundamental principles, breaking new ground and supporting the high-quality development of the real economy, and to take your questions. Also present at today's press conference are Mr. Pan Gongsheng, deputy governor of the PBC and head of the SAFE, and Mr. Liu Guoqiang, deputy governor of the PBC.

Now, let's give the floor to Mr. Yi for his introduction. 

Yi Gang:

Friends from the media, ladies and gentlemen, good morning. I am very glad to attend today's press conference. Over the years, you have paid much attention and given much support to the financing sector and the PBC's work. Here, on behalf of the PBC, I would like to express my sincere gratitude to all friends from the media and media outlets.

This year marks the first year in the implementation of the guiding principles of the 20th National Congress of the Communist Party of China (CPC). The PBC will follow the guidance of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, implement the decisions and arrangements of the CPC Central Committee, and provide strong financial support to achieve stable and sound economic growth. Now, I will brief you on the relevant ideas, policies and measures of our work. 

First, we will implement a prudent monetary policy in a targeted and effective manner to foster a favorable monetary and financial environment for high-quality economic development. The top priority is to stabilize the value of the renminbi (RMB). The stable value of the RMB has two implications, the first of which is stable prices. In recent years, we have persevered with a prudent and normal monetary policy, providing a solid foundation for stabilizing prices. As you know, the world experienced serious inflation last year. Many countries including the United States and some European countries registered inflation rates of 8%, 9% and even 10%, hitting a record high in the past four decades. China's consumer price index (CPI) rose by 2%, indicating an ideal inflation level. Over the past five years from 2018 to 2022, and even over the past 10 years from 2013 to 2022, China's inflation rate has averaged 2%. Over the past decade, China's CPI has reached as high as 2.9% and as low as 0.9%, with an average of 2%, which has not come easily. The second implication of stable value of the RMB is basically stable exchange rates. Over the past five years, the RMB breached the 7 per U.S. dollar level three times and fell back to below 7 per dollar. The RMB exchange rate has fluctuated in both directions with more flexibility. Compared with other currencies around the globe, the RMB is very stable and robust, and such flexible market-based exchange rate system has also helped regulate the macroeconomy and actively stabilized the international balance of payments. 

Next, we will comprehensively leverage multiple monetary policy tools, maintain reasonably ample liquidity, and see that increases in broad money supply (M2) and aggregate financing are generally in line with nominal economic growth. We will keep the RMB exchange rate generally stable at an appropriate, balanced level. 

Second, we will improve the ability, quality and efficiency of financial services for the real economy, and better support key areas and weak links. We have introduced moderate monetary policies. Some people call them structural monetary policies, but they are also moderate. Currently, the outstanding value of these structural monetary policies stands at 6.4 trillion yuan, accounting for around 15% of the PBC's balance sheets — a generally moderate proportion and level. The structural monetary policies support two key areas: one is micro- and small-sized enterprises and the private economy, and the other is green financing. In 2022, the outstanding balance of inclusive loans to micro- and small-sized businesses reached nearly 24 trillion yuan and more than 56 million micro- and small-sized businesses received inclusive loans. In terms of green financing, we have two supporting tools, which led to carbon emission reductions equivalent to 100 million metric tons of carbon dioxide last year.

In the next stage, we will intensify support for sci-tech innovation, manufacturing, green development and energy supply. Inclusive financial services will be further improved in fields such as micro- and small-sized businesses, rural revitalization and employment.

Third, we have strengthened the system to ensure financial stability, safeguarding the bottom line of preventing systemic risks. We all know that in recent years, China has made great efforts to ensure that financial risks have been contained. Currently, China's four major banks have become global systemically important banks and the top four banks in the world in terms of capital strength. Meanwhile, the operation of most banks in China, including share-holding banks and small and medium banks, is also stable. Important progress has been made in advancing reform and defusing risks for a few small and medium financial institutions with difficulties.

In the next step, we will move to ensure responsibilities for the prevention and disposal of financial risks are fulfilled by all parties concerned. The National People's Congress has completed the first review of the law on financial stability. We will push for enacting the law, placing all types of financial activities under regulation according to laws and protecting the interests of the overwhelming majority of people, small- and medium-sized investors and the insured. Moreover, we will strive to achieve the intended goals of rectifying the financial services of internet platform enterprises, stepping up regular oversight, and supporting platform enterprises' standardized and healthy development.

Fourth, we have deepened the reform of the financial system and orderly advanced higher-level opening-up in the financial sector. All have witnessed our achievements in this regard in recent years. In the next stage, we will continue to foster a market- and law-based, internationalized and world-class business environment. We will steadily promote institutional opening-up that covers rules, regulations, management and standards in the financial sector. We will also uphold multilateralism and actively participate in global financial cooperation and governance.

Next, my colleagues and I would like to answer your questions. Thank you.

Chen Wenjun:

Thank you, Mr. Yi. Now you are welcome to ask questions. Please identify the media outlet you represent before raising your questions.

CCTV:

My question is for Mr. Yi. Special plans and arrangements have been made in the report to the 20th CPC National Congress and at the Central Economic Work Conference to prevent and defuse major economic and financial risks. My question is, up to now, what progress has been made in preventing and defusing financial risks? What are the considerations for the work in the next stage? Thank you.

Yi Gang:

In recent years, under the strong leadership of the CPC Central Committee and the State Council, we have taken many effective measures to fend off and defuse financial risks, safeguarding the bottom line of preventing systemic risks. Financial risks have been contained overall. In dealing with financial risks, we have acted in accordance with market- and law-oriented policies to uphold the stable and sound operation of the financial market and infrastructure. We have ensured overall economic and social stability and effectively protected the interests of all our people. Also, we have adopted market- and law-oriented policies to guard against moral hazards and tighten market discipline. By doing so, he that does good shall find good; he that does evil shall find evil. All stakeholders can see the rules and thus have correct expectations. I would like to speak more about the following aspects: 

First, we have properly defused the risks of key institutions. We decisively took over Baoshang Bank, resolutely broke down rigid payments, and protected the interests of the general public in accordance with related laws. The bankruptcy of Baoshang Bank was the first case of its kind in China since reform and opening-up began. Meanwhile, we steadily defused risks for small and medium financial institutions, including Hengfeng Bank, the Bank of Jinzhou, and other city commercial banks in Liaoning province. Over the past three years, we supported local governments in issuing 550 billion yuan of special bonds to replenish the capital of small and medium banks. The number of high-risk small and medium financial institutions declined by half, from more than 600 to more than 300. There are no high-risk financial institutions in many provinces. Meanwhile, through targeted efforts, we have resolved the risks of high-risk financial groups, including Tomorrow Holdings Group and its units, Anbang Group and its units, China CEFC Energy Company Limited and its units, and HNA Group, avoiding the risk of their sudden collapse and preventing the spread of risks.

Second, we have made significant efforts to address acute problems in the financial sector. We have comprehensively implemented the new rules for asset management. The scale of high-risk shadow banking business, also called "quasi-credit," has shrunk by about 30 trillion yuan. We have promoted a campaign to address risks related to internet finance. Nearly 5,000 P2P online lending institutions have been closed. We have promoted the rectification of financial services of big internet platform enterprises in an orderly manner, placed all types of financial activities under regulation according to laws, regulated private equity, and stepped up efforts to reduce risks of both legal and illegal financial assets exchange. During the past five years, about 25,000 illegal fundraising cases have been investigated and dealt with.

Third, we have improved institutions and mechanisms for preventing and controlling financial risks. According to the decisions of the central government, we have advanced the establishment of financial risk disposal mechanisms led by major local leaders of the Party and the government. All provinces have set up financial risks disposal committees led by provincial leaders to see the responsibilities of financial institutions and their shareholders, supervisory departments, as well as local Party committees and governments. This creates a positive incentive for defusing financial risks. At present, all depository financial institutions nationwide have joined the deposit insurance scheme, which can provide full deposit guarantees for more than 99% of depositors. 

In general, China's financial performance is characterized by prudent, with financial risks shrinking and general risks under control. The banking industry account for more than 90% of China's financial sector, so it is prudent. China's foreign exchange reserves have ranked first in the world for many years. Last year, after continued efforts in the past decade and beyond, the PBC completed writing off the costs of financial reforms for state-owned commercial banks and rural credit cooperatives. This accomplishment further solidified the financial foundation of the modern central bank system and helped ensure currency stability in the financial sector. 

Moving forward, the PBC will collaborate with other financial management departments to enhance and modernize financial supervision, strengthen the system for ensuring financial stability, and tackle financial risks in major sectors. We will maintain high pressure on illegal financial activities and see the responsibilities of all parties to tackle risks fulfilled. In doing so, we can forestall systemic financial risks. Thank you. 

Tide News: 

As China continues to focus on economic growth in 2023, what monetary policies can we expect the PBC to implement in support of high-quality economic development? Thank you. 

Yi Gang:

This is a question everyone is concerned about. Monetary policies matter in support of high-quality economic development. The Central Economic Work Conference proposed the adoption of prudent monetary policies. Looking back on what we did over the past few years, we can gain a clear understanding of the key points in taking our future measures. There are several features in how momentary policies have supported high-quality economic development in recent years. 

First, our monetary policies have effectively supported the real economy in terms of economic aggregate, which is very important. The monetary policy, as part of macro policy, must adequately support the economic aggregate. Since 2018, we have reduced required reserve ratios 14 times and injected more than 11 trillion yuan to maintain long-term, reasonable, and ample liquidity. We maintained a reasonable increase in total credit, which played a crucial role in stabilizing employment and meeting basic living needs. We have created a favorable monetary and credit environment specifically for the maintenance of operations of micro and small-sized enterprises and market entities. The core of our policy lies in keeping price levels stable, which requires us to ensure that the M2 money supply and aggregate financing should generally increase in step with the nominal growth of GDP. This enables us to maintain a suitable aggregate monetary supply to keep price levels stable in China. 

Second, in terms of interest rate policies, mainly considering the domestic economy, we have kept a reasonable level of real interest rates to moderately lower financing costs. Let us review what we have achieved in the past several years. In 2018, when central banks worldwide raised interest rates, we kept a stable interest rate. In 2020, facing the impact of the COVID-19 pandemic, major central banks around the world lowered interest rates substantially. The PBC cut interest rates by 20 to 30 basis points while keeping them stable. Particularly in 2022, due to high inflation worldwide, major central banks significantly raised interest rates. In comparison, the PBC didn't raise interest rates but rather reduced them twice by 20 to 50 basic points. Meanwhile, loan prime rates by financial institutions were also reduced twice. Therefore, our financing costs last year were reduced, which greatly supported the real economy. Last year, the average interest rate of new loans for enterprises was 4.17%, 1.28 percentage points less than in 2018. The interest rate of inclusive loans to small and micro businesses was reduced from 6.3% in January 2018 to 4.9% in December 2022, both at historically low levels. We also supported micro and small-sized enterprises to lower their financing costs. 

Third, regarding the financial structure, we have shored up support for major sectors and weak links. We have upheld the principle proposed by the central government to work unswervingly both to consolidate and develop the public sector and to encourage, support, and guide the growth of the non-public sector. Our support has been extended to private enterprises and micro- and small-sized enterprises. In response to the difficult times caused by the COVID-19 pandemic, we have rolled out policies to assist micro and small-sized businesses by deferring principal and interest repayments on loans and providing collateral-free loans. These measures have been instrumental in ensuring the operation of market entities as well as employment. We have introduced a series of structural monetary policies that focused on the high-quality development of green finance, scientific and technological innovation, and infrastructure construction, as well as ensured the delivery of pre-sold housing projects. This year, we will further intensify efforts in these four aspects. 

Going forward, on the one hand, the total amount of money and credit should be moderate, and the pace should be stable to consolidate the results of the decline in real loan interest rates. On the other hand, the role of structural monetary policy should also be played moderately, and strong support should continue to be given to inclusive finance lending to micro and small businesses, green finance, scientific and technological innovation, and other areas.

The above is my brief answer to the focus of monetary policy to support high-quality development. Thank you.

Reuters:

In the case of continued interest rate hikes by the Federal Reserve, will the space for the Central Bank to continue to cut interest rates this year be further squeezed? In this situation, will we increase the use of structural monetary policy tools? Is the Central Bank concerned about the rise in inflation against the backdrop of the recent acceleration in domestic consumer demand recovery? Thank you.

Liu Guoqiang:

Thanks for asking. These are three questions, and I'll answer them individually.

First, on the issue related to the interest rate cuts, Mr. Yi said that last year our corporate loan interest rate was 4.17%, which was a record low. This year, the People's Bank will, in accordance with the decision and deployment of the CPC Central Committee and the State Council, continue to accurately and fully implement the prudent monetary policy, which is the general direction. But how to use specific policy tools, we will consider in an integrated manner, and choose accordingly. First, we will give prominence to the domestic target. Currently, the domestic economy is improving, but there are also some uncertainties. So for the next step, we will strengthen research, coordinate growth and prices, and adjust monetary policy tools in a timely and appropriate manner according to the changes in economic development and needs. Second, we will coordinate short-term and long-term, strengthen the cross-cyclical and counter-cyclical adjustments, adhere to normal monetary policy, maintain positive interest rates and an upward yield curve, and refrain from resorting to a deluge of strong stimulus policies. Third, we will keep in mind both domestic and international situations. We will focus on domestic development and reinforce sound regulation, and also pay close attention to international developments and better manage expectations, taking into account both the internal and external balance.

Second, structural monetary policy. Structural monetary policy has been leveraged more in the past few years. By the end of last year, there were a total of 15 structural monetary policy tools, with a balance of about 6.4 trillion yuan, which have effectively guided financial institutions to reasonably grant loans and promoted the tilting of financial resources to key areas and weak links. Structural monetary policy tools mainly play the leading role and work as a driving engine; that is, structural monetary policies drive financial institutions' subsequent loans, and these loans are actually those institutions' main way to support the development of the national economy. In the next step, we will continue to evaluate structural monetary policy tools and do a good job of classifying and managing them. For some key areas and weak links that need long-term support, structural monetary policy will give longer-term, continuous support, such as in the field of inclusive finance. Some tools with more pronounced phase characteristics should be withdrawn in a timely manner. Of course, we should emphasize a slow exit, making sure not to withdraw sharply. There are also a number of tools that can be considered to interconnect with other policy tools.

Third, regarding inflation, as Mr. Yi said earlier, China's CPI increased at 2% last year. Over the past five and even ten years, the CPI increased also at 2%. These achievements are not easy to come by. We attach great importance to the issue of prices, and we judge that the overall level of inflation in China in 2023 will remain moderate. In the short term, inflationary pressures are generally manageable because the economy is in the process of recovery and development, with inadequate effective demand still being the biggest challenge. The industrial and supply chain is running smoothly. Supply is relatively adequate, and the inflation expectations among citizens are relatively stable, so there are favorable conditions to help maintain the basic stability of prices. For the long term, there remain many unpredictable factors in the external environment, but demand is still gradually recovering. However, while the probability of inflation is not large, that does not mean that there is no chance of it increasing, so we must keep in mind the worst scenarios and remain vigilant against inflation.

In the next step, the PBC will remain committed to the general principle of pursuing progress while ensuring stability, and implement a prudent monetary policy with precision and vigor, so as to help keep major economic indicators within an appropriate range and ensure price levels are kept generally stable. Thank you.

Yicai:

The PBC and the China Banking and Insurance Regulatory Commission (CBIRC) jointly issued the 16-point set of financial measures at the end of last year in a bid to ensure the property market's stable and healthy development. Could you please share with us information regarding the implementation of these measures? Thank you. 

Pan Gongsheng:

Thank you for your question. Before answering it, I'd like to briefly discuss the background of the issue and relevant policies from a broader perspective. 

The CPC Central Committee has attached great importance to the healthy development of the property market. Since the 19th CPC National Congress, the CPC Central Committee has made clear its guidelines and policies for regulating the real estate sector, namely, adhering to the principle that housing is for living in and not for speculation, ensuring the long-term mechanism of keeping land costs, housing prices and market expectations stable, and implementing city-specific measures to facilitate positive circulation and sound development in the real estate sector. Under the leadership of the CPC Central Committee and the State Council, departments and lobal governments have ensured the implementation of the long-term mechanism of the real estate sector. This has helped curb the rapid expansion of the sector, sharp increases in housing prices, and real estate bubbles. 

Since the second half of 2021, some real estate enterprises, such as Evergrande, have been facing high risks with their balance sheets, because they have long been running business with a strategy characterized by “high leverage, high debt and high turnover.” As a result, they found it difficult to continue their business, which led them into crisis. Moreover, the average level of the medium- and long-term property market demand dropped, and the pandemic continued for three years and negatively impacted employment and income expectations. Given the multiple aforementioned factors, the spillover of the real estate sector's risks has increased.

Given the new situations in the real estate sector, the PBC, following the deployments of the CPC Central Committee and the State Council, released the 16-point set of financial policy measures at the end of last year to ensure the sound and stable development of the real estate sector. We have worked with departments concerned to step up efforts on both the supply and demand sides to promote the stable development of the sector. 

On the demand side, differentiated real estate credit policies have been implemented in places according to varied conditions, promoting declines in real lending rates and down payment ratios to provide more support for those buying their first homes or improving their housing situation. In December 2022, the average interest rate for newly issued individual housing loans was approximately 140 basis points lower than the level at the end of the previous year. The minimum down payment ratio allowed by local policies in most cities, apart from several hotspot cities, has reached the lowest national level. 

On the supply side, we have promoted the implementation of the 16-point set of measures to ensure the stable and healthy development of the real estate sector. We have implemented the program to improve the balance sheets of high-quality real estate enterprises, prevented financial institutions from getting overly risk-averse, and guide them to provide normal financing services. Real estate developers have been included in a program that supports private companies' bond financing. As such, financing in the real estate sector has been stable and in an orderly manner. We have rolled out 350 billion yuan of special lending set aside for presold projects' delivery, and set up a 200-billion-yuan loan support program for the same reason and a 100-billion-yuan loan support program for rental housing. We have made great efforts to guide financial institutions to promote mergers and acquisitions in the property sector, thereby accelerating the clearing up of risks by giving full play to the role of the market.

With the easing epidemic situation and the adjustment of the pandemic prevention and control measures, the policies put in place earlier have been able to bring greater positive influence and work more effectively. The recovery of market confidence has recently accelerated, and transactions in the real estate market have increased. Moreover, the financing environment of the real estate sector, especially high-quality real estate enterprises, has significantly improved. I'd like to share some figures. From September to December last year, real estate development loans increased by 230 billion yuan, 420 billion yuan more than in the same period in the previous year. In the fourth quarter, real estate companies issued 120 billion yuan of domestic bonds, up 22% year on year. In January this year, new loans for real estate development exceeded 370 billion yuan, an increase of 220 billion yuan year on year; 40 billion yuan of domestic real estate bonds were issued, up 23% year on year.

With China's ongoing urbanization, its residents and families have a great deal of demand potential for housing improvement. Moreover, the model of encouraging both housing rentals and purchases has great potential. Going forward, we will implement the deployments made by the 20th CPC National Congress and the Central Economic Work Conference, upholding the principle that housing is for living in and not for speculation. We will sum up experience and draw lessons from the development of the Chinese real estate sector and work with financial departments concerned to ensure the implementation of policies that have already been released. By doing so, we aim to support people in buying their first homes or improving their housing situation, help satisfy new urban residents' housing demand, and facilitate a housing market that prioritizes both housing rentals and purchases. We will improve the foundational system of real estate finance and the macro-prudential management system to promote the smooth transition of the real estate industry to a new development model. Thank you. 

Bloomberg:

I have two questions. First, from the perspective of weakening external demand, boosting domestic demand, and a widening service trade deficit this year, the current account surplus may provide less support for exchange rates. How does the central bank view the exchange rate situation this year and how will the central bank manage the RMB exchange rate? Second, China has shown a relatively good economic performance so far this year. Does the central bank still need to consider lowering the reserve requirement ratio or interest rates to stimulate economic growth?

Yi Gang:

As many have analyzed, the overall economic situation is improving regarding the exchange rate, but imports, exports and external demand are still relatively weak and face uncertainties. Just now, you asked how to view the exchange rate in this context. In the past few years, the mechanism through which the market sets the exchange rate has become increasingly more flexible , so it has acted well as an automatic stabilizer. In the past five years, the exchange rate has fluctuated at a ratio of about 4%, similar to that of major countries in the world. In the past, the fluctuation ratio of the RMB exchange rate had been minimal. However, in recent years, the ratio has gradually increased reasonably. In the past few years, the RMB exchange rate against the U.S. dollar has surpassed the "7" threshold three times, but it quickly fell back below the threshold. As you can see, the "7" threshold is not a psychological barrier. Though the exchange rate has surpassed the "7" threshold three times and fallen below, the overall economy has remained stable, and so have people's expectations. It is convenient for companies and people to enjoy foreign exchange services. The stability of economic and social expectations matters.

We have maintained a managed floating exchange rate regime based on market demand and supply, as well as a basket of currencies. It has worked very well and allowed businesses and the public to access foreign exchange services relatively freely to meet their reasonable foreign exchange needs concerning education, tourism, and imports and exports. Our view is that these policies should continue to be upheld in such a context. If you take a longer view, the stability of exchange rates is closely related to the well-being of the people. China's GDP last year was 121 trillion yuan, or about $18 trillion, with a per capita average of 86,000 yuan, or $12,700. Therefore, our comprehensive national strength and the well-being of our people are reflected not only through the RMB but also through the hard currency converted from the RMB. This is an important aspect of our modernization drive. Over the past 20 years, the RMB, despite fluctuating, has generally appreciated 20% against the U.S. dollar over the past 20 years, or 1% annually on average. At the same time, the real effective exchange rate of RMB calculated by the Bank for International Settlements has appreciated by about 40% over the past 20 years. A 40% appreciation over two decades is equivalent to an annual appreciation of 1% to 2%, which is a relatively appropriate level.

It is very important to maintain the stability of exchange rates because we have seen some cases in the world in which some countries are not able to avoid falling into the “middle-income trap” because of the sharp depreciation of exchange rates. So, on the one hand, we will keep exchange rates stable; on the other hand, our exchange rates must have flexibility . Just now, you asked about our considerations for this year and if we will continue implementing the mechanism. Overall, the RMB exchange rate will remain stable at a reasonable and balanced level. Some small fluctuations may appear driven by the market, but such fluctuations benefit the economy, China's imports and exports, and the people's expectations. In addition, more and more of our companies have learned to use hedging and forward settlement and foreign exchange tools to secure profits.

Your second question was whether we will cut the reserve requirement ratio or interest rates. We believe that the current level of some of the main variables of our monetary policy is relatively appropriate, as is the level of real interest rates. As for the reserve requirement ratio cut, we have cut it 14 times since 2018. These 14 cuts lowered the average statutory reserve requirement ratio from nearly 15% to less than 8%, a drop of over 7 percentage points. The less than 8% statutory reserve requirement ratio after the 14 cuts in the past five years is not as high as it used to be, but considering all things, cutting the reserve requirement ratio is still a relatively effective way to provide long-term liquidity and support the real economy so that overall liquidity remains at a reasonably ample level. I would like to invite Mr. Pan to share more about the exchange rate.

Pan Gongsheng:

Thank you. Mr. Yi has already given a very good and comprehensive answer. In recent years, China's ratio of current account surplus to GDP has stayed at about 2%, and the figure for last year was 2.3%, according to preliminary estimates. This year, there are many discussions about a potential slowdown of the global economy and trade and the potential gradual recovery of international flows as China's personnel flows adjust to anti-COVID policies and how this will affect trade in goods and services under the current account. We have done much research on it, and we believe that our current account has the basis and conditions to maintain a reasonable surplus.

The factors affecting the foreign exchange market and exchange rates are very diverse, such as economic growth, monetary policy, financial market, occasional risk event, and geopolitics. I would like to talk about our perspective of observing and analyzing the problem for your reference.

First, economic growth. With an easing epidemic situation, the optimized COVID-19 containment measures, and the effectiveness of earlier government policies to support businesses, domestic and foreign institutions predict that China's economic growth will be around 5% this year. On the other hand, it is also widely believed that major developed economies such as the United States may enter an economic recession, but there is a considerable divergence in opinions on how deep the recession could be. The growth gap between major economies such as China and the United States is expected to widen. China's economic growth will rebound to 5.2% in 2023, and US growth will slow to 1.4% in 2023, according to a report recently published by the International Monetary Fund (IMF).

Second, changes in the external financial environment. The market has different views on the peak interest rate of the Fed's current rate hike cycle and how long it will remain at a high level. However, there is a relatively high degree of consensus regarding the end of this round of interest rate hikes and the weakening momentum of the continued appreciation of the dollar. Therefore, the interest rate differential between China and the United States will remain stable or tend to diminish, the Fed's tight monetary policy will tend to ease this year, and the overall spillover effect will be marginally weakened.

Third, the investment value and attractiveness of Chinese yuan assets. As the Chinese economy is on course for a robust comeback and the country further advances its financial opening-up, the investment and risk-aversion attributes of yuan assets are highlighted. At present, the valuation of the domestic stock market is relatively low, and the interest rate differential between China and the United States is stable and narrowing, so yuan assets will show good investment value.

Fourth, if journalist friends observe and analyze carefully, you will feel that in recent years, the operation of China's foreign exchange market has shown a new feature. The operation of the foreign exchange market has shown relatively strong resilience, the main players in the market have become more mature, and the trading behavior has become more rational. In addition, the PBC and the SAFE, as regulators of the foreign exchange market, have also become more composed, calm, and experienced in the face of market changes.

Therefore, we are confident and capable of maintaining the stable operation of China's foreign exchange market and the basic stability of the RMB exchange rate at a reasonable and balanced level. Thank you.

China Securities Journal:

With the continuous opening-up of China's financial industry, we can see that the international status of the renminbi has greatly improved, and it has remained among the world's major currencies. My questions are, what are the achievements in promoting the internationalization of the renminbi? In 2023, what are the considerations of the PBC in promoting the internationalization of the renminbi? Thank you.

Pan Gongsheng:

Thank you for your questions. The process of renminbi internationalization has gone through more than a decade. With the growth of the Chinese economy and the increase in openness, renminbi's functions as an international currency in cross-border payments, investment and financing, reserves, and pricing, have been comprehensively enhanced. The international status of renminbi has also greatly improved, manifested in the following aspects:

First, renminbi accounts for about 50% of the country's total cross-border receipts and payments. In 2022, China's cross-border receipts and payments settled in renminbi totaled 42 trillion yuan, an increase of 3.4 times compared to 2017.

Second, renminbi's weighting in the IMF's Special Drawing Rights (SDR) ranks third currently. More than 80 countries and economies around the world have included renminbi in their reserve currencies, making it the fifth major reserve currency in the world.

Third, the use of renminbi in financial transactions continues to expand. China's bonds have been included in the three major international bond indices. By the end of last year, the balance of foreign entities holding renminbi assets in China was 9.6 trillion yuan, an increase of 1.2 times from 2017. The scale of stocks and bonds held by foreign entities was 3.2 trillion yuan and 3.5 trillion yuan, respectively. Overseas issuers have issued a cumulative total of 630 billion yuan in Panda bonds in China's bond market.

Fourth, the PBC has signed bilateral currency swap agreements with central banks or monetary authorities of 40 countries and regions, with a total amount of more than 4 trillion yuan. Last year, the PBC and the Hong Kong Monetary Authority upgraded the currency swap agreement to a long-standing one, increasing the swap size to 800 billion yuan. Moreover, we have expanded the arrangement of offshore renminbi clearing banks. Currently, 31 renminbi clearing banks have been authorized in 29 countries and regions, covering major international financial centers around the world.

The above is about the progress in RMB internationalization. We believe that we are currently facing a relatively favorable environment and opportunities in advancing RMB internationalization. First, over more than ten years of development, with the establishment of RMB clearing banks and local currency swap networks, the growth of the offshore RMB market, the opening-up of the domestic financial market, and the continuous improvement of the overseas layout of Chinese-invested financial institutions, we believe that the RMB has preliminarily shown the network effect of its international use. Second, as we deepen the reform of the RMB exchange rate formation mechanism, the RMB exchange rate has become more flexible, and enterprises are more willing to use the RMB in cross-border trade, investment and financing to avoid the risk of currency mismatch. Third, as China's economy gains growth momentum and its financial market further opens up, the investment and risk-hedging functions of RMB assets have been gradually enhanced. Fourth, the international monetary system is more diversified with the change in the global geopolitical and economic development environment. Therefore, we can conclude from these factors that RMB internationalization still faces a better environment and opportunities.

Next, we will earnestly implement the guiding principles of the 20th CPC National Congress, coordinate development and security based on the market-driven operations and independent choices of enterprises, and promote the internationalization of the RMB in an orderly manner. Our main work priorities are as follows: First, we will focus on trade and investment facilitation, improve the fundamental systems for RMB settlements in cross-border investment and financing transactions, improve cross-border RMB infrastructure, and expand the clearing bank network. Second, we will accelerate the institutional opening-up of the financial market, enhance the opening-up of China's foreign exchange and financial market and ensure better access to it, in a bid to build a more friendly and convenient investment and financing environment. Third, we will support and promote the healthy development of the offshore RMB market, improve the supply mechanism of RMB liquidity in the offshore market, and enrich RMB product systems in the offshore market to promote a virtuous cycle of the onshore and offshore RMB markets. Fourth, we will enhance the management, risk prevention and control capabilities of cross-border capital flow based on a broader opening-up environment. We will also establish and improve an integrated macro-prudential management framework for the cross-border capital flow of local and foreign currencies to guard against risks related to cross-border capital flow.

That's all about the current progress, situation and our next plan.

Yi Gang:

I fully agree with Mr. Pan's answer; please continue.

The Paper:

Data from the PBC shows that China's deposits hit a record high last year. How does the central bank view this data? Thanks.

Liu Guoqiang:

Thank you for your question. The significant increase in household deposits has been an eye-catching change in financial indicators since last year. In 2022, China's new household deposits increased by 17.84 trillion yuan, 7.94 trillion yuan more than the previous year. Since the beginning of this year, household deposits have maintained a fast-growing momentum. In January, household deposits rose by 6.2 trillion yuan, up 790 billion yuan year on year.

The rise in household deposits is mainly affected by consumers' spending and investment status and increased preference for liquidity. On the one hand, the COVID-19 epidemic has had a certain impact on consumption. As consumption decreases, savings will grow. A survey of depositors by the PBC showed that 61.8% of residents intended to save more money in the fourth quarter of 2022, up 10 percentage points year on year. About 22.8% of residents preferred to spend more, down 1.9 percentage points year on year. After the optimization of epidemic prevention and control policies, consumption has been significantly released, but it still needs time to recover. On the other hand, residents' lower appetite for risk and slower investment growth has led to a corresponding increase in deposits. In the fourth quarter of 2022, 15.5% of residents preferred to invest more, down 8 percentage points from a year earlier. By the end of January 2023, the asset management products of China's financial institutions totaled 95.9 trillion yuan, a figure directly summarized, down 2.4% year on year. Among them, household assets amounted to 40.9 trillion yuan, down 2.5% year on year. In addition, this year's Spring Festival fell in January. As enterprises paid wages and bonuses ahead of the Spring Festival, some of the deposits of enterprises were transferred to household savings, thus bringing an increase in household deposits.

As the macroeconomic performance improves, our residents' confidence in consumption and investment will increase, and their savings will gradually return to normal. The 20th CPC National Congress emphasized that we need to better leverage the fundamental role of consumption in stimulating economic growth. Clear requirements were put forth at the Central Economic Work Conference for prioritizing consumption recovery and expansion this year. After the optimization of epidemic prevention and control, the shortage in logistics and labor flow has been significantly improved, and consumption scenarios expansion has been sped up. Precautionary savings aggregated in the early stages are expected to be gradually released to meet actual consumption demand. A series of policies to promote consumption have been unveiled and implemented, and the policy effects will gradually become evident. In addition, as the economy improves, it will help enhance residents' confidence in investment, and residential investment will gradually return to normal levels.

Going forward, the PBC will act upon the spirit of the 20th CPC National Congress and the Central Economic Work Conference, accurately and strongly implement a prudent monetary policy, provide good financial services for residents to expand consumption and reasonable investment, and provide strong financial support for the development of the real economy. Thank you.

Cover News:

At the end of 2022, M2 money supply growth increased 11.8% year on year. In January this year, M2 achieved an increasing growth rate of 12.6% over the same period last year, the highest in six years. How do you view the rapid growth of M2? Thank you.

Liu Guoqiang:

Thank you for your question. At the end of January this year, the balance of M2 was 273.81 trillion yuan, a year-on-year increase of 12.6%, which was 0.8 and 2.8 percentage points higher than the end of December and the same period of last year, respectively, continuing its rapid growth since 2022.

The high growth rate of M2 is mainly due to the intensified measures of counter-cyclical adjustments in macro-regulation and the strengthening of financial support for the real economy by the financial system. Since 2022, due to the impact of unexpected domestic and foreign factors, China's economy has experienced acute downward pressure. In order to maintain macroeconomic performance, vigorous efforts have been made in counter-cyclical control policies, credit has maintained rapid growth, and derivative currencies have increased accordingly.

China has a financing structure dominated by indirect finance. Indirect finance is mainly based on credit loans, and direct finance mainly covers stocks and bonds. The assets of depository financial institutions in China account for more than 60% of the financial sector, which is much higher than that of developed countries in Europe and the United States. Indirect finance will lead to more derivatives of deposits, driving up the total amount of money. Since last year, M2 has been mainly generated through the expansion of assets in indirect financing. At the same time, due to fluctuations in the financial market, funds from wealth management and other asset management products have returned to the balance sheet, which has also led to the expansion of bank balance sheets, so the growth rate of M2 has been relatively high. If we combine the on-balance and off-balance sheets and look at social mobility in a comprehensive manner, the M2's growth rate is about 9.4%.

In addition, there are certain differences between China's M2 threshold and major countries. China's M2 threshold is relatively low, and there are no restrictions on the length and number of deposits, while other countries implement restrictions. For example, the U.S.'s M2 only includes fixed-time deposits of less than $100,000 and does not include fixed-time deposits greater than $100,000. In the European Central Bank ECB's M2, fixed deposits only include those of two years or less. The differences in these thresholds also makes the total size of China's M2 appear relatively large.

In general, while we are making counter-cyclical adjustments to maintain stable macroeconomic performance, our monetary policy remains prudent, and we will resolutely refrain from resorting to a deluge of strong stimulus policies.

In the next stage, the PBC will follow the guidance of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, thoroughly study and put into practice the spirit of the 20th CPC National Congress and the Central Economic Work Conference, and continue to maintain a prudent monetary policy. While focusing on expanding domestic demand and vigorously supporting the real economy, we will refrain from resorting to a deluge of strong stimulus policies. Thank you.

Financial Times:

Since China put forward the "dual carbon" goals, green finance has ushered in a broad space for development. What role does the PBC play in supporting green development? What are the further considerations? Thank you.

Yi Gang:

As you all know, in 2020, General Secretary Xi Jinping made a major policy decision for peaking carbon dioxide emissions and achieving carbon neutrality and announced China would strive to peak carbon dioxide emissions by 2030 and achieve carbon neutrality by 2060. The key to achieving these goals is to reduce carbon emissions. We know that carbon emissions have a negative externality . That is, companies or units that emit carbon do not pay for the carbon they emit, so their carbon emissions have a negative impact on society. What we can do in finance is to reduce this negative externality and gradually reduce the green premium. How to do this? We need to strengthen information disclosure. This way, the public will know who is emitting carbon and how much is being emitted, helping them to gradually realize that whoever emits carbon will bear the cost of their carbon emissions. This will reduce the green premium and make our green and clean energy cheaper so that households and enterprises are more willing to use green products.

In 2021, the PBC introduced the carbon-reduction supporting tool, whereby it rolled out re-lending programs for financial institutions with an interest rate of 1.75%, allowing them to offer concessional loans in accordance with market principles for sectors involving clean energy, energy conservation and environmental protection, and carbon-reduction technologies. Financial institutions receiving low-interest re-lending loans from the PBC must abide by one condition: they must promise to release their carbon emission-related loan balance, interest rate, and effect. The release of this information should be subject to the oversight of independent third-party institutions and the public while also being conducive to the promotion of the green development philosophy. The goals of peaking carbon emissions and achieving carbon neutrality require the people and society to develop concepts about eco-friendly lifestyles, green manufacturing, energy conservation, and carbon emission reduction. To achieve this goal, we have made plenty of efforts to promote carbon accounting and the release of environmental information.

So far, re-lending loans worth over 300 billion yuan have been issued via the carbon-reduction supporting tool, and supported commercial banks in issuing loans worth more than 500 billion yuan. This has helped reduce carbon emissions by the equivalent of 100 million tons of CO2. Two foreign banks were also included in the scope of the tool last year.

We also strengthened international cooperation on green finance. As co-chair of the G20 Sustainable Finance Working Group, China took the initiative to formulate the G20 Transition Finance Framework . Approved last year at the G20 Summit in Bali, Indonesia, the framework has become a guidebook for all countries' financial sectors to support green and low-carbon development. Meanwhile, China and the European Union also jointly issued two editions of the ''Common Ground Taxonomy.'' According to the latest version of this classification, the convergency between Chinese and EU economic activities for climate change mitigation has reached 80%.

Looking ahead, we will improve the standard systems for green finance and strengthen financial institutions' capacity for releasing environmental information. We will also support the development of green finance tools, enhance international cooperation on green finance, and bolster the green transformation of the national economy in a bid to make our ways of production and life more eco-friendly.

Chen Wenjun:

The last question, please.

China News Service:

Due to the impact of multiple factors, global economic and financial governance faces new challenges and requires joint efforts from all countries to cope with the difficulties. In the past few years, what progress has China made regarding global financial cooperation? What are the next plans? Thank you.

Yi Gang:

In recent years, China has adhered to multilateralism and the win-win principle. It has proactively participated in global multilateral governance and played a positive role in pandemic responses, international financial cooperation, and green finance. I'd like to elaborate on global cooperation from the following aspects:

First, we have strengthened communication and coordination with all countries in terms of macroeconomic policies. As we know, the pandemic has dealt a heavy blow to the world's economy since its outbreak. This makes it very important for the world's central banks and finance ministries to communicate their financial and economic policies. We have worked to push global macro policies to jointly support economic recovery so that the world economy can overcome the impact of the pandemic and achieve sustainable growth.

Second, regarding global cooperation, China has proactively participated in the G20's Common Framework for Debt Treatments . In line with the principle of common actions and fair burden-sharing, China has worked to address the debt issues of heavily indebted poor countries and made positive progress.

Third, in the context of a safe and manageable development, we have expanded high-quality financial opening up in an independent and orderly manner. In recent years, in accordance with the arrangements of the CPC Central Committee and the State Council, financial authorities have rolled out over 40 measures to open up the financial sector for both domestic and overseas companies. This has greatly expanded market access to financial services. Since 2018, over 110 financial institutions have been established with foreign capital in China. Meanwhile, we have also worked to promote the opening up of the capital market in both directions. This was applauded by investors both at home and abroad. Just now, Mr. Pan also elaborated on the foreign investment in China's stock and bond market, which has seen significant growth over the years. Chinese bonds and stocks have also been added to multiple global flagship indices, making Chinese assets one of the options for asset allocation among global institutional investors. China's asset allocation also has relevant benchmarks, indices, and sound supporting infrastructure facilities.

There are many other aspects in terms of financial opening up and global financial cooperation. Looking ahead, the PBC will keep strengthening global cooperation in the financial sector, work to make the voice of China and other developing countries more heard in global governance, and see that Chinese ideas can make new constructive contributions to the entire global economic and financial order. Thank you.

Chen Wenjun:

Thanks to all the speakers and friends from the media. Today's press conference is hereby concluded. Goodbye.

Translated and edited by Xu Xiaoxuan, Li Xiao, Liu Jianing, Liu Caiyi, Gong Yingchun, Zhang Jiaqi, Wang Mengru, Zhang Tingting, Yan Bin, Zhu Bochen, Wang Qian, Yang Xi, Li Huiru, Huang Shan, Liu Sitong, Ma Yujia, Wang Wei, Zhou Jing, Yuan Fang, David Ball, Tom Arnsten, and Jay Birbeck. In case of any discrepancy between the English and Chinese texts, the Chinese version is deemed to prevail.

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Read in Chinese

Speakers:

Mr. Wang Wentao, minister of commerce

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

Mr. Chen Chunjiang, assistant minister of commerce

Chairperson:

Ms. Xing Huina, deputy director general of the Press Bureau of the State Council Information Office (SCIO) and spokesperson of the SCIO

Date:

March 2, 2023

Xing Huina:

Ladies and gentlemen, good afternoon. Welcome to the press conference held by the State Council Information Office (SCIO). Today, we are holding the eighth press conference in the series "Embarking on the New Journey — A Government Perspective." We have invited Mr. Wang Wentao, minister of commerce; Mr. Wang Shouwen, China international trade representative and vice minister of commerce; and Mr. Chen Chunjiang, assistant minister of commerce, to brief you on building up confidence, making great efforts and taking new steps for the high-quality development of commerce, and to take your questions.

Now, I'll give the floor to Mr. Wang Wentao for a brief introduction.

Wang Wentao:

Ladies and gentlemen, friends from the media, it's my great pleasure to meet with you here again. First of all, on behalf of the Ministry of Commerce (MOFCOM), I would like to express my sincere gratitude to you for your long-term interest in as well as support and help for China's commerce development.

In the past year, under the strong leadership of the Central Committee of the Communist Party of China (CPC) with Comrade Xi Jinping at its core, MOFCOM resolutely implemented the requirements for keeping the epidemic at bay, stabilizing the economy and ensuring safe development, coordinated epidemic prevention and control with commercial development, and pursued steady progress in commercial operations, which exceeded expectations. The consumer market remained basically stable; foreign trade and investment reached another record high, and has become a highlight of the national economy; outbound investment grew steadily, and new steps were taken in the high-quality development of the Belt and Road Initiative (BRI); and breakthroughs were made in bilateral economic and trade cooperation, with the Regional Comprehensive Economic Partnership (RCEP) Agreement entering into force and the work team for China's accession to the Digital Economy Partnership Agreement (DEPA) being formally established.

The 20th CPC National Congress drew up a grand blueprint for comprehensively building a modern socialist country, emphasizing that we will make sure that our implementation of the strategy to expand domestic demand is integrated with our efforts to deepen supply-side structural reform, and boost the dynamism and reliability of the domestic economy while engaging at a higher level in the global economy. Commerce development is an important component of the domestic economy, serves as an important intersection linking the domestic and global economy, and plays an important role in fostering a new development pattern. These are the "three important roles" that we proposed for commerce development. We will shoulder an important mission on advancing the path to Chinese modernization. We will bear in mind the country's most fundamental interests, never forget the mission, stick to the "three important roles," promote the high-quality development of commerce, better serve the fostering of a new development pattern, and make greater contributions on the new journey in the new era.

2023 is the first year in fully implementing the guiding principles of the 20th CPC National Congress. MOFCOM will follow the guidance of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, resolutely implement the guiding principles of the 20th CPC National Congress and the decisions of the Central Economic Work Conference, fully and faithfully apply the new development philosophy, better balance both domestic and international situations, coordinate epidemic prevention and control with commercial development, and development with security, recover and expand consumption, keep foreign trade stable and improve its structure, make greater efforts to attract and utilize foreign investment, promote high-level opening up, and pursue effective improvement of quality and reasonable growth of quantity to help set the stage for building a modern socialist country in all respects.

Next, my colleagues, Mr. Wang Shouwen and Mr. Chen Chunjiang, and I will take your questions. Thank you.

Xing Huina:

The floor is now open for questions. Please identify the media outlet you represent before asking your questions.

China News Service:

At the Central Economic Work Conference, it was said that the country would prioritize the recovery and expansion of consumption. At present, domestic consumption is showing a steady recovery and good development momentum, but at the same time, it is also affected and restricted by factors such as citizens' consumption willingness and consumption environment. What measures will MOFCOM take to recover and expand consumption this year? Thank you.

Wang Wentao:

Let me take this question. Thank you for the question. Recently, the consumer market has been the focus of much attention. Since the beginning of this year, from New Year's Day to now, the entire consumer market has been gradually and steadily recovering with an obvious momentum. Monitoring by big data business platforms showed that during this year's Spring Festival holiday, the passenger flow in key business districts in 36 large and medium-sized cities across the country increased by 27.8% compared with the same period in the previous lunar year. Some business districts were filled with people. The sales of key retail and catering enterprises increased by 6.8% compared with the same period of the previous year. Some shopping malls, supermarkets, theaters and tourist attractions in various places were bustling. Lines could be seen outside many restaurants, and the table turnover rate was high in some restaurants enjoying popularity online. Bookings for hotels and flights began to heat up again, and culture, entertainment, sports and fitness consumption rapidly increased. It's fair to say that consumption got off to a good start at the beginning of this year, showing an obvious trend of recovery.

It was stated at the 20th CPC National Congress that we would work to expand domestic demand and better leverage the fundamental role of consumption in stimulating economic growth. The Central Economic Work Conference emphasized that priority should be given to restoring and expanding consumption. I think these statements attach importance to the function and status of consumption, respectively. "The fundamental role" focuses on the function of consumption, while "being given priority" puts an emphasis on the status of consumption. In your question, you mentioned two keywords: restoring and expanding, so I would like to answer your question and introduce our specific thought and measures through these two words. Restoring mainly refers to our present work. Part of consumption was affected by the COVID-19 pandemic, especially contact-based offline consumption. Therefore, our main task at present is to restore it, working to increase consumers' confidence and restore market vitality. Expanding refers to the future. On the basis of recovery, we will improve consumption conditions and innovate consumption scenarios, making efforts to promote consumption upgrading and the release of potentials. Based on stabilizing consumption in key areas and innovating and developing new-type consumption, we will focus on three aspects to restore and expand consumption.

First, we will carry out a series of "Year of Consumption Promotion" activities to boost consumers' confidence and consumption vitality. MOFCOM has designated 2023 as the "Year of Consumption Promotion" and will coordinate with relevant government departments and all localities, industries, associations, enterprises, and organizations to carry out a series of events to encourage purchases. We will create a strong consumption atmosphere with the theme of "Joys for All Year, Benefits for Everyone." Specifically, we have a plan of "6+12+52+N." "6" refers to six major themed activities. The months of January and February are the Spring Festival consumption season, and March is designated as the national consumption promotion month, for which we held a launch ceremony with the city of Beijing the evening before last. Following these events, we will also have consumption seasons focused on low-carbon, summer, autumn, and international exchanges, respectively, among others. "12" refers to 12 key expos, including the China International Import Expo (CIIE), which will help promote supply-demand matching and lead consumption trends. "52" indicates the 52 weeks in a year, during which various activities will be held regularly across the country, such as "A Happy Spring Festival with Ice and Snow, " "New Appliances, Green Lifestyle," and "Celebrating Asian Games, Enjoying Asian Specialties." "N" refers to supporting localities in holding distinctive consumption boost activities that align with their unique characteristics and consumption scenarios, such as the Beijing-Tianjin-Hebei Consumption Season, Shanghai 5·5 Shopping Festival, and Zhejiang's "Consumption in Zhejiang." With such activities being held one after another, we will ensure that there are constantly brilliant consumption promotion activities, achieving the goal of "holding activities of different themes for each quarter, new expos for each month, and new scenarios for each week." These activities are expected to bring about waves of consumption.

Second, we will stabilize and improve consumption in key areas, consolidating consumption fundamentals. Automobiles, home appliances, home furnishing, and catering are four major fields of consumption, contributing to one-fourth of the overall consumption. Therefore, they are key areas for restoring and expanding consumption. Last year, a series of policies were introduced to promote the sales of new energy vehicles and their positive impact was evident. The sales of new energy vehicles nearly doubled to exceed 6.8 million. The sales of new energy vehicles accounted for a bigger part of the sales of all types of automobiles. For every four cars sold, one is a new energy vehicle. This year, we will not only fully implement existing policies but also proactively introduce new policy measures. For instance, we will guide local departments to introduce new energy vehicles to rural areas, improve the operational charging environment and other services, and support purchases of new energy vehicles. Certainly, promoting new energy vehicles in rural areas presents more complicated issues than in cities, such as how to improve the supporting facilities including charging stations. We will coordinate with relevant departments to make proper plans and work harder to make steady progress. We will also expand the circulation of second-hand cars, promote purchases of green and smart home appliances in rural areas, and encourage the exchange of old appliances for new ones to stimulate household consumption of appliances and furnishings. Meanwhile, we will support the healthy development of new consumption forms and models to boost consumption vitality.

Third, we will advance the fostering and development of international consumption center cities, and innovate carrier scenarios. It is an important decision and arrangement made by the Party Central Committee to foster and develop international consumption center cities. In recent two years, we have collaborated with five cities, including Shanghai, Beijing, Guangzhou, Tianjin, and Chongqing, to strengthen top-level design and overall planning. Backed by steady progress, we have achieved preliminary results. Shanghai has become a benchmark of the "first-store economy," Beijing has completed the upgrading and renovation of 22 traditional business districts, Tianjin's Golden Street and the Florentia Village outlet mall have been upgraded, Guangzhou has gathered new momentum through expos, and Chongqing has focused on cultivating the night economy and shaping the city brand of "sleepless Chongqing." Going forward, we will continue to focus on the three keywords: international, consumption, and center. We will strengthen the functional orientation and distinctive features of each city, and promote the implementation of plans for fostering and developing center cities through project-based management and checklists. We will also improve consumption carriers and the environment, navigate new consumption fashions and trends, and play a demonstrative and leading role in the expansion and restoration of consumption. Thank you.

CCTV:

China has spent a decade on building and improving its pilot free trade zones (FTZs). The 20th CPC National Congress proposed implementing a strategy to upgrade pilot FTZs. What will MOFCOM do next to constantly promote the country's FTZ construction, and how can we best play FTZs' role of testing ground for China's reform and opening up? Thank you.

Wang Wentao:

Thanks for your questions. The construction of pilot FTZs is a crucial strategic measure taken by the CPC Central Committee to deepen reform and opening up in the new era. It has been ten years since China established its first FTZ in Shanghai in September 2013. So far, we have established 21 pilot FTZs across the country, including the Hainan Free Trade Port, and basically shaped an innovative pattern of reform and opening up covering the east, west, north, south, and central regions. Over the past decade, we introduced a series of pioneer practices, continuously broke new ground, and had many institutional innovations on reform and opening up replicated in other places across the country, giving full play to the role of FTZs as testing grounds for China's reform and opening up. These are mainly demonstrated in the following aspects.

First, FTZs became a leading force for China's high-quality opening up. Many "firsts" occurred in FTZs. The first negative list for foreign investment access was rolled out at an FTZ, marking China's first step in adopting a foreign investment administration model of pre-establishment national treatment plus a negative list. After seven reductions, the number of items on the FTZ negative list for foreign investment have been reduced to 27 from 190, and the number of items regarding the manufacturing sector on the list has dropped to zero. The expansion of opening up in the service sector illustrates that the country's opening up is widening. In the Hainan Free Trade Port, we put in place the first negative list for cross-border service trade, achieving fundamental change in the management model of service trade.

Second, the FTZs became vanguards for China to deepen its reforms. In FTZs, we first implemented the reform separating operation permits from business licenses, first carried out reform on foreign investment access system, established the first Single Window system for international trade, and opened the first batch of free trade accounts. Many "firsts" have been practiced and explored in FTZs and then applied nationwide. At present, 278 institutional innovations have been applied across the country, involving investment facilitation, trade facilitation, financial openness and innovation, operational and post-operational supervision, and reform of state-owned enterprises, which continuously released reform dividends. 

Third, the FTZs became a lead for China's high-quality development. Relying on the advantages of China's super-large market and its own resources, FTZs have attracted global high-quality resource elements and seen more and more high-end industrial clusters taking shape. In 2022, the actual use of foreign capital in new and high-tech industries of the 21 pilot FTZs increased 53.2% year on year, far exceeding the national average. Their ability to attract investment and shape industrial clusters showed clearly. The FTZs have been building on their ability to support major national strategies, leveraging their strategic positions and advantageous situations.

The 20th CPC National Congress proposed accelerating the development of the Hainan Free Trade Port and implementing a strategy to upgrade pilot FTZs. To implement the strategy, we should focus on the word "upgrade." To upgrade pilot FTZs, we will try and align with high international standards to promote opening up through institutional guarantees and give full play to the role of FTZs as comprehensive testing platforms for China's reform and opening up so as to explore new paths to comprehensively deepen reform and expand opening up. Our efforts will mainly be made in three aspects:

First, we will align with international economic and trade rules that hold high standards. We will focus on key fields like trade and investment, government procurement, intellectual property rights, and the environment and formulate and issue pilot reform measures. We will carry out trials in the free trade port and in some qualified FTZs, and be the first to establish institutional systems and regulatory models that are in line with high-standard international economic and trade rules in order to make breakthroughs in deepening reforms in relevant areas at home.

Second, we will improve the market access management. We will enhance stress tests, an important function of the FTZs, in investment and service trade. Next, we will further shorten the negative list for foreign investment and expand opening-up in the modern service industry. In the service trade sector, we will introduce negative lists for cross-border trade in services, one for FTZs and one for other places across the country, and implement a new model for managing cross-border trade in services on a larger scale.

Third, we will promote integrated reforms and collaborative innovations. We will enhance trans-department, trans-sector, and trans-industry coordination and intensify systematization, integration, and collaboration of pioneer projects so as to adapt to the current situation of new industries, new models, and new forms of business. We will further improve liberalization and the facilitation of trade and investment, strengthen institutional and integrated innovation, and focus on a new generation of information technology and biomedicine. We will also explore institutional innovation to accelerate the building of a modern industrial system and maintain security and stability for the country's industrial and supply chains. Thank you.

Hong Kong Bauhinia Magazine:

This year marks the 10th anniversary of the BRI. I would like to ask, what achievements have been made in economic and trade cooperation under the framework of the initiative? What new measures will MOFCOM take to promote the high-quality development of the BRI? Thank you.

Wang Wentao:

Mr. Chen will answer this question.

Chen Chunjiang:

Since General Secretary Xi Jinping put forward the BRI in 2013, MOFCOM has worked with relevant parties to steadily promote economic and trade cooperation along the Belt and Road and made noticeable progress. Trade and investment between China and participating countries have steadily expanded, infrastructure connectivity has been strengthened, and cooperation in industrial chains and supply chains has been constantly enhanced. In terms of trade, from 2013 to 2022, China's trade in goods with countries along the Belt and Road doubled from $1.04 trillion to $2.07 trillion, with an average annual growth rate of 8%. In terms of investment, from 2013 to 2022, China's two-way investment with countries along the Belt and Road exceeded $270 billion. As of the end of 2022, Chinese enterprises had invested a total of $57.13 billion in overseas economic and trade cooperation zones in countries along the Belt and Road, creating 421,000 jobs for local people. In terms of project construction, from 2013 to 2022, the total value of newly-signed contracts and the total turnover of completed projects in countries along the Belt and Road exceeded $1.2 trillion and $800 billion, respectively, accounting for more than half of the total value of overseas projects contracted.

This year marks the 10th anniversary of the BRI. Standing at this new starting point, MOFCOM will thoroughly implement the guiding principles of General Secretary Xi Jinping's important speeches on jointly building the BRI, and decisions and deployments made at the 20th CPC National Congress. We will jointly prepare for the third Belt and Road Forum for International Cooperation and continue to deepen and consolidate economic and trade cooperation along the Belt and Road. We will lay more focus on the following five aspects.

First, we will concentrate on improving quality. We will optimize the trade structure and expand imports of quality goods while continuing to expand trade with participating countries. We will get more deeply involved in the global industrial division of labor and cooperation and improve the two-way investment structure. We will also promote the negotiation and signing of free trade agreements with more participating countries and speed up the building of a free trade zone network covering the Belt and Road countries. We will make good use of trade corridors, promote cooperation in building the New International Land-Sea Trade Corridor, and improve the quality and efficiency of the China-Europe Railway Express service.

Second, we will expand areas of cooperation. We will meet the development needs of participating countries and seek the conclusion of bilateral cooperation agreements on green development, the digital economy, and the blue economy. We will promote all-around cooperation in green infrastructure, green energy, green industries, and green trade and further bolster the green development of the BRI. We will actively foster new forms and models of digital cooperation, promote the development of "Silk Road e-commerce," and create pilot zones for "Silk Road e-commerce" cooperation.

Third, we will launch more quality projects. We will promote the construction of high-quality infrastructure projects with participating countries and expand tripartite and multi-party market cooperation. We will focus on the areas of poverty reduction, health, education, and others, and introduce more "small but beautiful" projects to enhance local people's sense of gain and recognition. We will promote the upgrading of overseas economic and trade cooperation zones and jointly build demonstration zones for economic and trade innovative development with ASEAN countries. 

Fourth, we will build more platforms. We will give full play to the role of multilateral and bilateral economic and trade mechanisms and platforms and promote the establishment of more working groups on unimpeded trade and investment cooperation. We aim to successfully deliver various kinds of exhibitions, such as the China and Central and Eastern European Countries Expo, the China-Arab States Expo, and the China-Africa Economic and Trade Expo. We will earnestly implement the outcomes of the Shanghai Cooperation Organization summits, the China-Arab States Summit, and the China-Gulf Cooperation Council Summit and promote the implementation of the nine programs for China-Africa cooperation.

Fifth, we will strengthen guarantees. We plan to provide high-quality public service products and continuously issue guidelines for overseas investment and cooperation by country and region. We will also promote the signing and upgrading of investment protection agreements with participating countries to provide more guarantees for the high-quality development of the BRI. Thank you.

CNBC:

Some time ago, foreign enterprises were faced with multiple investment options, and some of them even considered options other than China. But recently, many senior executives have said they plan to visit China for market research. What's MOFCOM's comment on this situation? What's your considerations and plans for attracting foreign investment in 2023?

Wang Wentao:

Thank you for your question. The first half of your question refers to some considerations and choices among foreign enterprises, which are temporary and exceptional cases. The second half mentioned that many senior executives from foreign companies plan to visit China, which represents a long-term trend. Recently, my colleagues and I have had many face-to-face exchanges with senior executives of foreign enterprises. From our meetings, we can tell that many executives are still optimistic about China's economic prospects and willing to continue to invest in China and further explore the Chinese market. Some companies have said that the Chinese market is indispensable, rather than optional. We truly appreciate their remarks. 

Statistics showed that China utilized 1.2 trillion yuan of foreign investment last year, up 6.3% year-on-year, or 189.1 billion US dollars, up 8% year-on-year. Since the beginning of this year, it has continued to grow. In January, the utilization of foreign investment was 127.7 billion yuan, up 14.5% year on year, or $19 billion, a year-on-year increase of 10%. Clearly, there have been ups and downs during different months or years. On many occasions, a major project may bring about an increase in foreign investments, which was normal. Over the long run, the Chinese market is an irreplaceable option for global enterprises. 

The Chinese government has attached great importance to the utilization of foreign investments. Not long ago, Xi Jinping, general secretary of the Communist Party of China (CPC) Central Committee, published an important article in the Qiushi Journal, elaborating on several major issues involving current economic work, one of which was that we would make greater efforts to attract and utilize foreign investments. It was a strong signal and an important deployment of the goals set at the Central Economic Work Conference as well as a guiding principle for our key tasks of this year. We will step up efforts to promote investment, improve services, expand opening up, optimize the business environment, strive to retain high-quality foreign investment, and bring in more high-quality foreign investment. I would like to answer this question in the following four aspects.

In promoting investment, the ministry will initiate a "Year of Investing in China" program. We will pool all resources and work with local governments to attract investment through a series of regular and diversified activities. These activities mainly integrate moves to bring in outside resources with the drive to go global. The focus is to establish platforms and open more channels, thus demonstrating investment opportunities offered by different provinces and regions across the country and showcasing the golden brand of "Investing in China." In terms of "bring in outside resources," we will launch activities such as ceremonies, themed forums, and special promotion campaigns hosted by certain local governments. In addition, events like "Multinational companies tour in China" and CIIE in provincial regions will be held to boost foreign investment. In terms of "going global," we will support local governments and companies to visit the United States, Europe, and some places in Asia and the Gulf region, and launch some key promotion projects in a targeted way. At the same time, we will make use of exhibitions and fairs, give full play to the role of overseas business agencies and investment promotion agencies and carry out investment promotion activities at various levels and in different forms so as to create a better platform and bridge to facilitate investment.

In improving services, we will provide targeted services to foreign-funded enterprises. During the pandemic, we held regular discussions with foreign-funded enterprises and chambers of commerce to acquire an understanding of the problems they had encountered and help solve their problems. Under the foreign trade and foreign investment coordination mechanism, there is a special work group for major foreign investment projects, which collects information on issues concerning foreign-invested enterprises, promoting the settlement of those issues, and providing better services for foreign investors, thus creating a sound business environment for foreign-funded enterprises.

In pursuing higher-quality opening-up, we will explore to reasonably shorten the negative list for foreign investment and further lift or ease restrictions on access for foreign investment. In particular, we will give full play to the pioneering and leading role of platforms such as the pilot FTZs, the Hainan Free Trade Port, the demonstration and pilot projects for wider opening-up of the service sector, and national-level economic development zones. We will promote opening-up at a greater and higher level in line with high-standard international economic and trade rules, and steadily move ahead with institutional opening-up.

Besides, we will optimize the business environment for foreign investors. We will thoroughly implement the Foreign Investment Law and its implementing regulations to apply national treatment to foreign enterprises with high standards. Issues many foreign enterprises raise, such as those regarding government procurement, bidding and standards formulation, will be key focuses of our work. We will work with relevant departments to conduct research and roll out policy measures to ensure foreign enterprises have equal access to those opportunities. We will establish cross-department complaint and coordination mechanisms at all government levels, improve complaint handling, step up the protection of the legitimate rights and interests of foreign investors, and foster a market-oriented, law-based, and internationalized business environment. Thank you.

CGTN:

China has been following the trend of regional economic integration, and actively promoted the building of FTZs. At the 18th CPC National Congress, the CPC decided to advance the Free Trade Area Strategy. Then, at the Fifth Plenary Session of the 19th CPC Central Committee, it announced that the nation would implement the strategy of upgrading FTZs. Moreover, the report to the 20th CPC National Congress proposed to expand the globally-oriented network of high-standard free trade areas. My questions are, what achievements have been made so far in relation to these fields? What kinds of considerations will the ministry take into account for the next step?

Wang Wentao:

Mr. Wang Shouwen will answer this question.

Wang Shouwen:

Thank you for your questions. The Party Central Committee has attached great importance to the construction of FTZs and free trade agreements. Since the 18th CPC National Congress, a series of arrangements have been made. The Ministry of Commerce has paid great attention to the Free Trade Area Strategy and adopted measures to implement this strategy, as made by the Party Central Committee. As such, we have seen many achievements.

First, the circle of friends of the free trade zone is expanding. Before the 18th CPC National Congress, we built 10 FTZs; after the 18th CPC National Congress, we added nine FTZs in the past 10 years. There were 18 free trade partners before the 18th CPC National Congress, and now we have 26. It can be said that we have initially established a network of free trade agreements with neighboring countries as the basis that will also benefit the Belt and Road participants and serve the whole globe. In particular, we made some new progress in the construction of the FTZ last year. The Cambodia-China Free Trade Agreement (CCFTA) and the protocol on upgrading the China-New Zealand free trade agreement were launched. We also signed an FTA early harvest agreement and launched FTA negotiations with Nicaragua. We also started the Version 3.0 China-ASEAN Free Trade Area negotiations and made positive progress in the FTA negotiations with six countries of the Gulf Cooperation Council (GCC). After these FTAs came into effect, they played a vital role in our foreign trade. So far, the import and export volume with our FTA partners reached 14.25 trillion yuan last year, rising by 7.7% over the same period, accounting for 34% of our total foreign trade.

Second, the world's largest free trade bloc was officially launched, that is, the RCEP agreement officially entered into force on Jan. 1 last year, giving a strong impetus to the growth of trade and investment within our region and globally. After this agreement entered into force, the Ministry of Commerce attached great importance to it, and we, together with five other departments, issued the Guidelines on High-Quality RCEP Implementation to promote the formation of good experiences and innovative practices in the implementation of RCEP in more than 30 provincial-level regions. We have also carried out a series of external works to enhance the implementation of RCEP. For example, some countries have signed the RCEP agreement, but their parliaments have yet to ratify them. Therefore, China and other countries have worked together on it, and now all 15 member countries have ratified the agreement. Last year, China's exports to other RCEP members grew by 17.5%, accounting for 27.6% of China's total exports. RCEP has played a vital role in the development of our foreign trade.

Third, we have made progress in actively promoting accession to high-standard economic and trade agreements, such as the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) and the DEPA, which represent the highest international standards in the field of economic and trade rules. In relation to the CPTPP, China has had extensive contact and exchanges with its members at different levels. For the DEPA, we have also had excellent communication with its members. On Aug. 18 last year, members of the DEPA agreement decided to set up a working group for China's accession. In November last year, the three members of DEPA and China held a quadripartite ministerial conference. In December last year, the quadripartite held a kick-off meeting of chief negotiators. In addition, we attach great importance to the construction of the Free Trade Area of the Asia-Pacific (FTAAP) and support the promotion of some work plans within the framework of APEC to promote the FTAAP to take more steps forward.

The reporter mentioned earlier that the 20th CPC National Congress proposed to expand the globally-oriented network of high-standard free trade areas. Last year's Central Economic Work Conference also stressed that China will actively seek to join high-standard economic and trade agreements such as the CPTPP and the DEPA, and to deepen domestic reforms to align with high-standard international economic and trade rules, regulations and management. In this regard, the MOFCOM, in accordance with the deployment of the CPC Central Committee, will continue to expand its globally-oriented network of high-standard free trade areas, and we are prepared to take a series of measures to fully implement the guiding principles of the 20th CPC National Congress.

First, we will seek progress while maintaining stability and improving the comprehensive utilization rate of existing FTAs. We will improve the utilization rate of the 19 FTAs just mentioned and give full play to their benefits. Last year, the comprehensive utilization rate of the 19 FTAs was nearly 80%, with some exceeding 98%, but the utilization rate of some FTAs is still relatively low. Therefore, we have to take a series of measures to guide enterprises through training to use these FTAs well and give full play to them, laying a better foundation for expanding the globally-oriented network of high-standard free trade areas.

Second, we will comprehensively promote the Version 3.0 China-ASEAN FTA negotiations this year. We hope to create new highlights like the digital and green economy to make this agreement stay up-to-date with the times and make it more modern. In February this year, we completed the FTA with Ecuador and aimed to sign it this year formally. We also strive to complete the FTA negotiations with Nicaragua this year. We continue to promote the FTA negotiations with the GCC, Israel, and other countries and regions and strive to make more progress. We also have some upgraded FTA negotiations with Peru, South Korea, and Singapore and we strive to achieve good results.

Third, we will continue to facilitate the process of joining CPTPP and DEPA. In terms of CPTPP, Mr. Wang Wentao mentioned that our domestic pilot FTZs should deepen reforms in accordance with the high standards and rules of CPTPP, and we will work on these goals. As for DEPA, we have made a series of arrangements, including ministerial-level as well as department or bureau-level negotiations, to make substantive progress in joining DEPA. Regarding APEC, we will continue to promote the development of the FTAAP, further contribute to regional development, and work with all parties to advance regional economic integration. Thank you.

21st Century Business Herald:

We learned that county-level commercial systems are vital to comprehensively promoting rural revitalization, and relevant arrangements have been made in the "No. 1 central document." What progress has been secured in this regard? Going forward, what measures will MOFCOM take to strengthen county-level commercial systems and promote rural consumption? Thank you.

Chen Chunjiang:

The report to the 20th CPC National Congress states that continuous efforts will be made to pursue the integrated development of urban and rural areas and facilitate the flows of production factors between them. The county-level commerce has its root in rural areas and serves the work, life, and employment of more than 7 million county residents. It connects urban and rural areas and constitutes an important channel for the flow of goods, services, and production factors between them. Relevant arrangements were made in the No. 1 central document. Over the past several years, we have worked with related departments to promote the development of county-level commercial systems and striven to improve the rural consumption environment, increasing service quality and making initial progress along the way. These are mainly reflected in four respects:

First, the commercial network has been continuously improved. In 2022, a total of 983 comprehensive county-based business and trade service centers and 3,941 township markets and business and trade centers were transformed. The transformation work underlines the importance of converting facilities, not traditions, to retain as many of the features and heritage of rural markets as possible.  

Second, logistics services have been constantly accelerated. A total of 506 county-level logistics centers and 650 township-level express delivery outlets have been built. Direct express delivery services are now available in 95% of administrative villages. Currently, more than one-third of counties can have their express parcels sent to villages within a day. 

Third, e-commerce livestreams have been promoted extensively. Livestream marketing has become an effective tool for rural residents to start businesses and increase income. Last year, rural online businesses (online shops) totaled 17.3 million nationwide, up by 6.2% year on year. Among these, 5.73 million, or 33.1%, were livestream e-commerce businesses.

Fourth, the circulation of agricultural products has been improved. A total of 890 wholesale markets for agricultural products and farmers markets have been transformed and upgraded. A total of 960,000 tons of refrigeration storage capacity has been added. The production and marketing connection of agricultural products has become closer, and circulation has become smoother and more efficient. 

Over the past few years, we have witnessed major improvements in rural logistics systems, business facilities, and the consumption environment. However, shortcomings still exist. As for infrastructure, the business outlets in some areas are scattered, and delivery costs are still relatively high. Therefore, further integration and optimization are needed. Regarding the supply of goods and services, goods are often not high in grade, and service provision functions are not rich in variety. In terms of market entities, most are family-based workshops with traditional operation modes, whose levels of digitalization and developing chains are relatively low compared with those in cities. As to market demand, since many villagers have gone elsewhere to find employment, and the majority who have stayed are senior citizens and children, chain businesses and enterprises lack the motivation to invest in rural areas. 

Looking forward, we will earnestly implement the guiding principles of the 20th CPC National Congress and follow the deployment of the No. 1 central document. We will stay problem-oriented, shore up the weak links of county-level commercial development, focus on providing channels at the community level, promote further recovery and expansion of rural consumption, and better contribute to rural revitalization. 

First, we will thoroughly implement the three-year action plan for country-level commerce. We will summarize the previous work experience and apply it at a faster pace, and strive to basically establish relatively improved commercial systems in counties, townships, and villages by 2025 to better meet the work and life needs of rural residents. 

Second, we will speed up efforts to improve the rural consumption environment, act on market principles, and give play to the guiding role of government funds. We will transform and upgrade a group of township markets and a new type of rural convenience stores, improve the logistics systems at the county, township, and village levels, develop new modes such as real-time retail and joint delivery, create consumption scenarios, and stimulate consumption potential.

Third, we will promote the high-quality development of rural e-commerce. We will follow the development trends of the digital economy, develop livestream e-commerce, cultivate agricultural product brands, and sell them via e-commerce across the country to increase rural residents' incomes.

Fourth, we will foster a group of county-level commercial models. We will act on local conditions; explore to make innovations; stimulate localities, enterprises, and the public; and develop a group of county-level commercial models, giving full play to their demonstrating and leading roles. Thank you.

Economic Daily:

The report to the 20th CPC National Congress stated that China would resolve the most pressing difficulties and problems that are of great concern to the people. At present, residents in some urban communities are still facing serious living inconveniences. In recent years, the Ministry of Commerce has started the development of 15-minute community life circles to solve the problem. What progress has been made in this regard? And what will you do next to promote the work?

Wang Wentao:

Your questions are related to the development of community businesses. Studies have shown that more than half of urban residents' daily consumption and expenditure is concentrated within one-kilometer reach of their community, which is a distance of a 15-minute walk. Within that reach, the consumer market has tremendous potential. To build 15-minute community life circles in cities is to accelerate the development of community businesses, which allows residents to enjoy convenient and quality life and services near their residences. This is not only an important way to boost consumption, but also an important measure to improve people's well-being and warm their hearts. 

In the past two years, we have worked with related authorities and fully implemented the decisions and plans of the Party Central Committee. We have started the development of 15-minute community life circles in 80 cities in two batches, and introduced services into communities and residential areas. So far, we have built 1,402 community life circles covering more than 32 million residents. The pilot cities have attached great importance to this work, and many of them have incorporated it into local projects concerning people's livelihoods.

Residents in pilot areas have said that their lives have become easier, faster, and smarter than before. Their basic needs, including three daily meals and necessities, have been met in the community life circles. On this basis, we are striving to meet their personalized, diversified, and specific needs. A survey showed that the residents' comprehensive satisfaction rating reached 93% in pilot areas. Local examples include neighborhood centers and smart food markets in Jiangsu province, Zhejiang province, and Shanghai; community workshops and community libraries in cities such as Ji'nan and Fuzhou; and dynamic maps of life service outlets in 10 cities, including Beijing and Tianjin, with the supply and demand for community consumptions being monitored dynamically through big data.

Next, we will make a summary on the basis of the preliminary work and offer solutions to the problems. We will launch a three-year initiative to build 15-minute community life circles nationwide. Generally speaking, we will adopt city-specific or community life circle-specific measure to meet people's needs. We will not follow a uniform standard or sample, but provide personalized, diversified, and specialized solutions. We will improve the layout plan for community consumption, strengthen consumption platforms and facilities, provide more convenient and smarter services, and diversify consumer businesses. We will encourage all cities at and above the prefecture level, where conditions permit, to take action and build 15-minute community life circles in various forms by 2025 to meet the basic daily needs of the people.

Based on the problems and needs of great concern to the people, as well as the preliminary pilot experiences, we will focus on the matters of people's urgent needs. First, we will develop convenience stores and breakfast stalls. Convenience stores allow people to buy necessities within a 15-minute walk. Breakfast stalls are an urgent need of the people. We will promote more chain, branded convenience stores and breakfast stalls to enter communities and introduce some special, traditional, and entrepreneurial market players. 

Second, we will develop food markets and repair shops. Food markets include large markets and small vegetable shops. We will upgrade them in line with certain standards with more focus on the environment, hygiene, and quality control to assure people in their consumption. Repair shops are mainly engaged in services such as duplicating keys and repairing shoes to meet residents' daily needs.

Third, we will offer better elderly care and child care. We will build and improve service facilities to alleviate people's concerns.

In a word, our work will promote consumption and serve as an important people's well-being project. We will stay problem-oriented and solve issues that are of urgent concern to the people. We will work to transfer the list of people's needs into a list of satisfaction over 15-minute community life circles and build them into happy circles of community for residents. Thank you.

The Poster News APP:

With its foreign trade reaching another record high in 2022, China remains the world's largest goods trader. At present, with rising risks, such as the global economic recession and a slowdown in the growth of external demand, China's foreign trade faces a challenging environment for development. How does the Ministry of Commerce view foreign trade in 2023? What upcoming measures will be adopted to stabilize foreign trade? Thank you.

Wang Wentao:

As you mentioned, China's foreign trade set a record high in 2022. The volume of trade in goods surpassed 40 trillion yuan for the first time, standing at 42.1 trillion yuan, with a year-on-year increase of 7.7%, leading the world for six consecutive years and making a great contribution to the stable performance of the macroeconomy. The contribution of net trade exports in goods and services was responsible for 17.1% of GDP growth, driving GDP growth by half a percentage point. At the beginning, I mentioned this was a highlight of last year's economic work.

With the rising risks of global economic recession and the probability of stagflation, the external environment poses severe challenges to us. According to the WTO's prediction, global trade in goods this year will only increase by 1%, down 2.5 percentage points from 2022. In other words, the possibility of expanding the global foreign trade pie this year is relatively small. We must think about continuing to harness our strengths under such circumstances. The problem now is, as you mentioned, how we should view foreign trade in 2023 and what we intend to do under such circumstances.

How should we view foreign trade in 2023? This year's mounting pressure on foreign trade is due to weakening external demand. Under such circumstances, many enterprises have reported decreased orders and delays in placing orders. Moreover, bulk orders become small orders, and standing orders become short-term orders. Some media, especially economic media, have also provided an analysis. These are all current situations. Apart from weakening external demand and rising risks such as a global economic recession, protectionism and geopolitics have also led to challenges for Chinese enterprises.

What do we intend to do? According to the report to the 20th CPC National Congress, we will build China into a trader of quality, which requires us to stabilize the volume of foreign trade. Building a trader of quality consists of three pillars: upgrading trade in goods, developing new mechanisms for trade in services, and promoting digital trade. We will work on the above three aspects. Generally speaking, we will stabilize trade volume and improve trade structure this year. We will stabilize trade volume first. Meanwhile, with the upgrade in industries, economic development, and enhanced comprehensive strengths, we need to improve the foreign trade structure to strengthen its comprehensive competitiveness.

We will prioritize the following three aspects regarding stabilizing trade volume. First, we will maintain the continuity of policies. By doing so, we intend to anchor market expectations. Last year, foreign trade was confronted with severe challenges. In response to the impact of COVID-19 and uncertainties in external demand, we consecutively issued two policies to stabilize foreign trade, which created 42.1 trillion yuan of foreign trade volume last year. We are researching some policies mainly based on business entities' needs. We are listening to the opinions of relevant provinces and enterprises and get to know their difficulties. Considering all these difficulties, we will introduce policies in line with international rules to promote the development of foreign trade. Second, we will stabilize the market. We will stabilize traditional markets such as the U.S., Europe, Japan, and South Korea and expand emerging markets. Latin American countries and the Belt and Road partner countries have enormous market potential. Last year, trade growth between China and ASEAN surpassed traditional markets. ASEAN has become China's largest trading partner. Third, we will stabilize the trade channels. We will use traditional channels such as the China Import and Export Fair (Canton Fair) to launch trade promotion activities. At the same time, we will also encourage enterprises to participate in overseas expos, and encourage local governments, trade promotion institutions, and business associations to carry out a diverse range of trade promotion activities. According to media reports, since China downgraded its response measures against COVID-19, some enterprises have organized teams to travel overseas to obtain orders. These are proactive actions taken by enterprises.

We will adopt three major measures concerning optimizing the foreign trade structure. First, we will improve the modes of trade. While developing general trade, we will support the transformation and upgrading of processing trade and its shift (to the central and western regions). We will take coordinated steps to promote the rapid and healthy development of new forms and models, which are now growing rapidly, including cross-border e-commerce, overseas warehouses, and the maintenance of bonded goods. Concerning trade in services, based on the pilot program launched earlier, we will advance the building of national demonstration zones for the innovative development of trade in services. Second, we will optimize the layout of foreign trade supply chains. We will implement the coordinated regional development strategy, improving trade quality in the eastern regions and raising the trade proportion of the central, western and northeastern regions. At present, there is an increasingly strong tendency for the shift of industries to the central, western, and northeastern regions. The advantages in locations, resources, and costs of production factors of these regions are gradually emerging, including labor and land resources. In terms of transport, as the China-Europe Railway Express and new land-sea transit routes have been further developed, transport is improving, providing a stronger driving force for industrial relocation. Concerning the layout of supply chains, the costs of production factors in coastal areas continue to increase, but the central, western, and northeastern regions still have huge potential. Third, we will upgrade the product structure and foster new growth drivers for trade. We will consolidate our traditional strengths. Meanwhile, as China's industries move towards a medium-high level, we will continue to nurture new areas of trade growth during this process. Among the three new leading industries that have been frequently mentioned, automobiles, especially new-energy vehicles, as well as lithium batteries and photovoltaic products, have made an impressive performance in exports. They have experienced rapid export growth and developed a new growth driver. We will also support localities in exploring the organization of the digital trade expo, accelerate the construction of a digital pilot zone for global trade in the Guangdong-Hong Kong-Macao Greater Bay Area and continue to improve trade digitization, providing more growth drivers for trade.

To conclude, we face a challenging situation this year but have strong confidence. We will fully implement the guiding principles of the 20th CPC National Congress and make efforts to stabilize trade volume and improve trade structure. At the same time, we will hear the opinions and demands of business entities and formulate targeted policies and measures to enable better development of enterprises on the international market. Thank you. 

Hong Kong Commercial Daily:

Statistics from China and the U.S. have shown that the bilateral trade in goods in 2022 hit a record high. However, the U.S. recently rolled out measures to crack down on China-related enterprises and products, drawing wide attention from all parties. How does MOFCOM see the future development of China-U.S. economic and trade ties? Thank you. 

Wang Shouwen:

Thank you for your question. Apart from the impact of the COVID-19 pandemic, unilateral protectionism measures by the U.S. have also taken a toll on China-U.S. trade ties in past two years. Nevertheless, the China-U.S. trade volume has hit a record high. Statistics from China suggest that the bilateral trade volume was over $750 billion last year, demonstrating that China-U.S. trade ties are highly complementary and resilient enough to resist pressure. 

Over the past three years, U.S. agricultural products exported to China as a share of U.S. total export volume have steadily increased, approaching one-fifth in 2022. Thus, China has become the largest export market of U.S. agricultural products. Each year, the U.S. receives a revenue of $15 billion from exporting intellectual property services to China. Therefore, the China-U.S. trade relationship is quite complementary and resilient. 

However, their ties' complementarity and resilience have not been fully leveraged. In 2022, the growth rate of China's global exports was 6 percentage points higher than that of China's exports to the U.S., while the growth rate of U.S. global exports was 16 percentage points higher than that of U.S. exports to China. The volume of China-U.S. trade indeed increased to a record high, but the growth was not fast due to the undeveloped potential. As you mentioned, the U.S. has taken restrictive measures in China-U.S. trade, which hindered the bilateral trade ties, decreased the comparative advantages of the U.S. and the competitiveness of its products, and damaged the confidence and willingness of the two countries' enterprises to enhance cooperation. Is the U.S. a reliable cooperation partner and source of product supply for Chinese enterprises? Measures taken by the U.S. not only harmed its own interests but also violated WTO rules. The U.S. has imposed Section 301 tariffs on Chinese goods for over four years. The WTO ruled that Section 301 tariffs do not comply with WTO rules. Under the pretext of protecting national security, the U.S. added some Chinese enterprises to its export control list. That was an abuse of the concept of national security and a violation of WTO rules. China has sued the U.S. in the WTO. 

Going forward, given China-U.S. trade ties have the huge potential to grow and are highly complementary, we should maximize mutual benefit and win-win cooperation in terms of bilateral trade and economy. A report by the U.S.-China Business Council suggests that U.S. exports to China provided 1 million jobs in the U.S. Meanwhile, Chinese exports to the U.S. helped bring down inflation in the U.S., benefit U.S. consumers, and increase the competitive advantages of U.S. enterprises. In the future, we will further strengthen China-U.S. trade and economic cooperation based on mutual benefit and win-win results. 

In November 2022, President Xi Jinping met with U.S. President Biden in Bali, Indonesia. The leaders of the two countries agreed that their teams should conduct coordination and dialogues on economic and trade ties. China stands ready to work with the U.S. to implement the consensus reached by the two countries' leaders. The two sides shall exchange honest views, coordinate with each other, and communicate about lifting bilateral trade and investment restrictions according to the principles of mutual respect, peaceful coexistence and win-win cooperation, abiding by WTO rules and the rules of the market economy and free trade. We call for a stable and reliable China-U.S. trade and economic environment to boost confidence for cooperation between enterprises of the two countries. I believe that China-U.S. trade and economic cooperation will reach new levels. 

The U.S. will host APEC meetings this year. The U.S. and China can take this opportunity to hold bilateral, regional and multilateral talks. This will enable them to address the concerns of both sides in the trade and economic sectors. Thank you. 

Yicai:

The fast development of digital trade in recent years has initiated reforms in traditional trade forms and rules, becoming a new engine driving economic growth. What measures will MOFCOM take to advance digital trade development? Thank you. 

Wang Wentao:

I will answer your question. Currently, a new round of technological revolution and industrial transformation is advancing, and the boom of the global digital economy has given rise to digital trade characterized by digital ordering and delivery, with data as a key factor of production, and with digital services as its core. This is also a new trend in international trade. Some even say it will be a new engine for future trade growth. All kinds of trade negotiations now involve digital trade, and hence digital trade deserves close attention at present and in the future. 

China's digital trade has seen rapid growth in recent years. For example, about 2.5 trillion yuan of trade in services was achieved via digital means in 2022, a 78.6% increase compared with five years ago. As I mentioned earlier, cross-border e-commerce has also been thriving. Last year, the foreign trade volume of China's cross-border e-commerce reached 2.1 trillion yuan, a 30.2% increase compared with two years ago. The 20th CPC National Congress articulated the goal of accelerating China's transformation into a high-quality trader in three aspects, namely, trade in goods, trade in services, and digital trade. This has elevated the importance of digital trade to a new level. China has the world's largest number of internet users and relatively abundant data resources. Meanwhile, encouraging progress has been made as we have created several application scenarios. These have laid a solid foundation for us to develop digital trade. In other words, China's digital trade growth has a solid foundation, promising prospects, and ample potential. Looking ahead, we will seize the opportunity of digital trade development and accelerate its growth by focusing on the following four aspects:

First, we will strengthen top-level design concerning digital trade. Policy documents on promoting the opening-up and innovative development of digital trade are being drafted. In other words, we will issue policies at the national level to boost digital trade.

Second, we will enhance the development of digital trade platforms. We will implement measures to support the innovative development of national digital service export bases and enhance their strength, quality and size. We will also develop leading companies in digital trade, ensure the success of the Global Digital Trade Expo, and make steady progress in the construction of digital trade demonstration zones. Expos, demonstration zones, leading companies, and export bases are the means we need to develop digital trade.

Third, we will foster new business forms and digital trade models. We will proactively support the trade of digital products and continuously improve trade in digital services. We will also steadily promote the trade of digital technologies and proactively explore trade in data. We will intensify our efforts to use digital technologies to empower trade activities from start to finish and improve trade digitalization. Silk Road e-commerce is another way to build cooperation overseas, and it has proven popular in many countries. We will proactively develop Silk Road e-commerce and promote the sustained development of cross-border e-commerce.

Fourth, we will establish and improve governance systems for digital trade. We will step up the formulation of basic institutional arrangements and standardized systems for data resource property rights, transaction circulation, cross-border transmission, and security and protection. Digital trade has been involved in many high-standard international economic and trade pacts, such as the DEPA and the CPTPP. We will proactively promote the process of joining DEPA and CPTPP and constructively participate in formulating and negotiating international rules and standards. Digital trade is thriving, and many rules are yet to be determined. As a country with abundant digital resources and a vast digital economy, China is bound to be a key player in digital trade. We will proactively participate in formulating rules for digital trade, offer more Chinese solutions, and contribute more Chinese ideas to the sector. Thank you.

Hong Kong Economic Herald:

In recent years, with the development of network information and digital technology, the global division of production in the service sector has accelerated, placing higher demands on countries to open up their service sectors. How will MOFCOM continue to promote the opening-up of China's service sector?

Chen Chunjiang:

Thank you for your question. The service sector is a major part of the Chinese economy, accounting for more than 50% of China's GDP. The further opening-up of the service sector will enable the introduction of various high-quality production factors and help construct a modern industrial system to serve the new development pattern and pursue high-quality development. The 20th CPC National Congress proposed building a new system of efficient and high-quality services and promoting more integration of modern services with advanced manufacturing and modern agriculture. The Central Economic Work Conference proposed increasing the level of opening-up in the modern service industry. In accordance with the decisions and plans of the CPC Central Committee and the State Council, we will actively pursue the high-level opening-up of the service sector, improve the institutional environment, stimulate market vitality, and better meet the needs of daily work and life. This year, we plan to focus on three aspects of work.

First, we will ease market access for the service sector. Since 2017, China has revised the negative list for foreign investment five consecutive times, canceling or relaxing foreign equity caps in value-added telecommunications services, securities, banking, insurance, cultural performances, and other services. In the future, we will proactively align with high-standard international economic and trade rules, and study further measures to cancel or ease restrictions on foreign investment in the service sector for industries with large domestic market demand, strong industrial driving effects, sufficient foreign investment willingness, and controllable risks. We aim to attract more global high-end service companies and elements to enter the domestic market.

Second, we will promote the institutional opening-up of the service sector. We will fully leverage the leading role of FTZs and ports and take the lead in standardizing domestic laws and regulations that affect the free and convenient trade of services at the Hainan Free Trade Port, achieving internal and external consistency in terms of both allowing firms in and letting them do business. We will roll out a series of measures to open up the service sector, earnestly implement the negative list for cross-border trade in services at the Hainan Free Trade Port, and issue a national version and a pilot free trade zone version of the negative list for cross-border trade in services to improve the level of liberalization and facilitation of trade in services. We will steadily enhance the construction of comprehensive pilots and demonstrations for the expansion and opening-up of the service sector. We will drive forward the issuance of plans to deepen the development of a national integrated demonstration zone for greater openness in the services sector in Beijing. Moreover, we will adjust supporting laws and regulations in newly added pilot areas, encourage pilot and demonstration areas to explore experiences that can be replicated and promoted based on their development positioning, and leverage the guiding role.

Third, we will accelerate innovation and the development of trade in services. Mr. Wang Wentao already said that we would promote the introduction of guiding opinions on the opening-up and innovative development of trade in services. We will do a good job of reviewing and concluding the pilot project of comprehensively deepening innovation and developing trade in services. On this basis, we will upgrade to build national demonstration zones for the innovative development of trade in services. We will formulate management measures for exporting bases providing characteristic services, establish service outsourcing demonstration cities with high standards, and support the fast development of new models and formats of service outsourcing, such as crowdsourcing and crowd innovation, cloud outsourcing, and platform subcontracting. We will support building international trade services cooperation zones where conditions permit and pursue the high-standard development of Belt and Road cooperation in the service sector. Thank you.

Xing Huina:

Today's press conference is hereby concluded. Thank you to the three speakers and all our friends in the media. Goodbye.

Translated and edited by Zhang Liying, Zhou Jing, Lin Liyao, Qin Qi, Ma Yujia, Liu Caiyi, Xu Xiaoxuan, Duan Yaying, Xu Kailin, Liu Jianing, Zhu Bochen, Yan Bin, Wang Qian, Zhang Rui, Liu Sitong, Zhang Junmian, Huang Shan, He Shan, Li Huiru, Yang Xi, David Ball, Tom Arnsten, and Jay Birbeck. In case of any discrepancy between the English and Chinese texts, the Chinese version is deemed to prevail.

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Read in Chinese

Speakers:

Ms. Wang Xiaoping, minister of human resources and social security

Mr. Li Zhong, vice minister of human resources and social security

Mr. Yu Jiadong, vice minister of human resources and social security

Chairperson:

Ms. Shou Xiaoli, deputy director general of the Press Bureau of the State Council Information Office (SCIO) and spokesperson of the SCIO

Date:

March 2, 2023

Shou Xiaoli:

Ladies and gentlemen, good morning. Welcome to this press conference held by the State Council Information Office (SCIO). This is the seventh briefing in the series "Embarking on the New Journey — A Government Perspective." Today, we are joined by Ms. Wang Xiaoping, minister of human resources and social security. Ms. Wang will brief you on the situation concerning employment and social security, and take your questions. Also joining us are two vice ministers of human resources and social security, Mr. Li Zhong and Mr. Yu Jiadong.

Now, I'll give the floor to Ms. Wang for a brief introduction.

Wang Xiaoping:

Friends from the media, ladies and gentlemen, good morning. I'd like to thank you for your long-term efforts in communicating social conditions, public opinions and beneficial policies in a sincere and responsible manner. We also appreciate your support for the work involving human resources and social security. At today's press conference, my colleagues and I will exchange ideas with you on the efforts concerning employment and social security.

Employment and social security issues concern the lives of all families. Since the 18th National Congress of the Communist Party of China (CPC), the CPC Central Committee with Comrade Xi Jinping at its core has taken improving people's wellbeing as the ultimate goal of socioeconomic development. It has acted on the people-centered development philosophy, and specified an approach to improving people's wellbeing, namely ensuring basic needs, prioritizing key areas, improving institutional arrangements, and guiding public expectations. A series of major decisions and plans have been made regarding employment and social security, and the employment-first strategy has been implemented. This has ensured our social security work in better helping those most in need, building a tightly woven safety net, and establishing the necessary institutions. As a result, historic achievements have been made, and people's sense of gain, happiness and security has become more sufficient, better-protected and sustainable.

In the past decade, the proactive employment policy system with Chinese characteristics has been consistently enriched and developed; the pro-employment mechanism has been constantly improved; and a working pattern has been formed featuring autonomous jobseekers, adjustable market mechanisms, and government support for employment and entrepreneurship. Relatively sufficient employment has been achieved in China, a developing country home to over 1.4 billion people. The central government has made employment a priority in its endeavor to ensure stability on six key fronts (employment, finance, foreign trade, inbound investment, domestic investment, and market expectations) and maintain security in six key areas (jobs, daily living needs, food and energy, industrial and supply chains, the interests of market players, and the smooth functioning of grassroots government). As a result, employment-first policies and related supporting measures continue to be strengthened; business startups are boosting employment to greater effect; and the employment service system continues to be improved. The number of jobs in urban areas has risen significantly. The number of newly created jobs in urban areas averaged 13 million per year. The employment situation among key groups, such as college graduates, migrant workers and people having difficulty securing employment, was stable. The number of migrant workers who have shaken off poverty remained above 30 million. In addition, the employment structure continues to be optimized. The employment pattern in urban and rural areas has seen a historic change. Over 60% of employees worked in urban areas, and 48% of employees worked in tertiary industries. Flexible employment and other new forms in this regard have developed in a well-regulated manner and become a new growth driver for jobs. It is fair to say that the quality of employment has been steadily improved; workers' vocational skills continue to be enhanced; employees' income has seen stable growth; and their rights and interests have been effectively protected.

In the past decade, the construction of China's social security system has entered a phase of rapid development, and a fully functional social security system with distinctive Chinese features that covers the largest population in the world has been established. China's social security system has seen the most intensive reform efforts and the fastest development during this period. The central government has formulated and implemented the overall plan to reform and improve the basic old-age insurance scheme. It has realized national unified management for basic old-age insurance funds for enterprise employees. It has created a unified national basic old-age insurance system for both urban and rural residents. It has also brought government office and public institution pension schemes into line with enterprise schemes. These have further improved the nation's multi-level and multi-pillar endowment insurance system. The insurance system for unemployment and work-related injuries has been enhanced. China has worked further to ensure that everyone has access to social security. A total of 1.05 billion people have been covered by basic old-age insurance, 224 million by unemployment insurance, and 290 million by work-related injury insurance. Social security funds have also seen stable operation with their management continuously strengthened. In 2022, the revenue and expenditure of the three social security funds totaled 13.7 trillion yuan, and social security-related payments were made on time and in full. A five-level social security management and service network has been basically established. We continue to expand the application scope of social security cards, and related management and services have become well-regulated, standardized and IT-oriented. As a result, a social security system aimed at full coverage, ensuring basic needs, developing multi-level services and achieving sustainability has been strengthened in an all-round way. The basic lives and diverse needs of the people have been guaranteed in a more reliable manner.

The report to the 20th CPC National Congress put forward the mission and tasks to advance the rejuvenation of the Chinese nation on all fronts through a Chinese path to modernization. Aiming to improve people's well-being and raise their quality of life, it emphasized that employment is the most basic component of the people's well-being and that the social security system provides a safety net for people's livelihoods and helps ensure social stability. In the context of implementing the employment-first strategy and improving the social security system, it made special deployments and defined goals, requirements and tasks. Human resources and social security authorities at all levels across the country will uphold the guidance of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era in order to properly understand the connotations and requirements of the mission to advance the Chinese path to modernization. We will thoroughly study and understand General Secretary Xi Jinping's important expositions on the work related to employment and social security. We will prioritize implementing an employment-first strategy to promote high-quality and full employment. We will also carry out in-depth social security system reforms to build a sound, sustainable and multi-tiered social security system that covers the entire population in both urban and rural areas and performs in a fair, integrated, reliable and well-regulated way. We will unswervingly implement the new deployments and requirements of the 20th CPC National Congress on the work related to employment and social security through concrete actions.

This year marks the first year to fully implement the guiding principles of the 20th CPC National Congress. The Central Economic Work Conference has clearly listed the major tasks for the year. We will earnestly implement the decisions and arrangements of the CPC Central Committee and the State Council to ensure the implementation of all tasks, ensure overall stable employment, and promote the high-quality and sustainable development of social security. With such efforts, we will strive to get the work on employment and social security off to a good start.

Next, my colleagues and I would like to exchange ideas with you. Thank you.

Shou Xiaoli:

Thank you for your introduction, Ms. Wang. Next, the floor is open to questions. Please identify the media outlet you represent before raising questions.

Cnr.cn:

The report to the 20th CPC National Congress emphasized that we should implement the employment-first strategy, intensify efforts to implement the employment-first policy, and improve related mechanisms to promote high-quality and full employment. What measures will the ministry take to ensure implementation? Thank you.

Wang Xiaoping:

Thank you for your question. I'd like to answer it. Employment plays a basic and fundamental role in improving people's well-being and also serves as an essential condition and an important goal of economic and social development. The CPC Central Committee with Comrade Xi Jinping at its core has attached great importance to employment, always prioritized employment in pursuing economic and social development, and made various major decisions and arrangements to provide fundamental guarantees for stable employment. The report to the 20th CPC National Congress clearly proposed that we should implement the employment-first strategy and intensify efforts to implement the employment-first policy, which is the "double firsts" concept. It emphasized that employment is the most basic component of the people's well-being, scientifically set the important goal of high-quality and full employment, and put forward a series of important measures. The Central Economic Work Conference emphasized the major decision and deployments for stabilizing growth, employment and prices, deepening our recognition of the mission and responsibility for ensuring employment, and also defining the right direction and providing the fundamental guiding principle for the work to guarantee employment on the new journey. 

I think improving mechanisms and fulfilling responsibilities are key to ensuring full implementation. We will resolutely implement the decisions and deployments made by the Party Central Committee and the State Council, take stabilizing employment as a major political responsibility and the most prioritized work, and further promote the coordination and cooperation among all localities and governmental departments. The key to ensuring full implementation also lies in understanding new requirements and providing the solid effect of the employment-first concept. We should constantly expand employment capacity and improve its quality, ensuring that people are satisfied with their jobs and professions to maintain the overall stability of employment. Specifically, we will adhere to the following five aspects:

First, we will adhere to a target-oriented approach, focusing on the strategic role of employment. We will concentrate on the new target of promoting high-quality and full employment. We will also improve the evaluation system and supporting measures, ensuring more adequate employment opportunities, a more reasonable employment structure, a more equal employment environment, increasingly strengthened employment capability, and a steadily improved security level. We will aim to achieve a sound cycle of both economic growth and higher-quality and expanded employment.

Second, we will adopt a systematic method and uphold the employment-first policy. The macro regulation mechanism aiming to prioritize employment will be improved faster. We will make stepped-up efforts to establish a mechanism to evaluate the impacts that major investments, major policies, and the distribution of major productive forces may have on employment. Moreover, we will intensify our support to industries and enterprises that can provide more jobs. 

Third, we will consider worst-case scenarios and provide more employment support for key groups. We will establish a management mechanism that records the employment status of certain groups, including young people, especially university graduates; migrant workers, especially those who were lifted out of poverty; and unemployed individuals, especially those who face difficulties. By doing so, we will offer help to people in need according to the record, and refine our systems for ensuring people's basic living needs and for providing employment assistance. 

Fourth, we will adopt a problem-oriented approach and eliminate institutional barriers that hinder the flow of labor resources. We will improve the public service system for employment and make greater efforts to improve the market-, standard-, and system-based human resources development. We will refine the information monitoring mechanism to ensure that the labor in urban and rural areas can flow orderly and efficiently. We will also improve the policy system to ensure equal employment opportunities and eliminate unjustified restrictions that undermine equal employment. In this way, we will ensure that everyone has the opportunity to pursue a career through hard work.

Fifth, we are committed to improving relevant systems to create a predictable environment that stabilizes employment. We will improve the system for creating jobs by encouraging business startups and ensuring more people are willing to start and able to start their own businesses. We will improve the system of lifelong vocational training, launching special training programs in key areas to tackle structural unemployment. We will improve the systems for safeguarding workers' rights and interests to protect workers' legitimate rights. Thank you. 

China News Service:

Migrant workers have started returning to their posts and resuming production since the Spring Festival. Meanwhile, enterprises are also hiring employees. Could you please share more information in this regard? Thank you. 

Wang Xiaoping:

This is a good question. It is about the employment situation this year. Given the slowing economic growth rate, the COVID-19 pandemic, and the complex and volatile external environment in 2022, the CPC Central Committee and the State Council have taken decisive and effective measures. Local governments and relevant departments have resolutely shouldered the responsibility to stabilize and ensure employment. They rose to the challenge and forged ahead with resolve. As a result, the overall employment situation has remained stable. A total of 12.06 million new urban jobs were created, and the employment of key groups was stable. Moreover, some 32.78 million people lifted out of poverty found jobs, an increase from the level of the previous year. 

As the performance of the Chinese economy improves, employment will rebound this year so that the overall situation will remain stable. This is due to important factors as follows. The CPC Central Committee has attached great importance to employment, and the 20th CPC National Congress made a series of important deployments to ensure employment. These policies have served as guiding principles to ensure high-quality and full employment. The Chinese economy enjoys strong resilience, tremendous potential and great vitality. The fundamentals sustaining its long-term growth have remained strong. These have created favorable conditions to maintain employment stability in the long run. Moreover, innovation and entrepreneurship continue to provide new jobs, serving as a driving force to promote employment. The policies of stabilizing and ensuring employment will continue to be implemented, and the policies of reducing burdens, stabilizing jobs and increasing employment will be adjusted and improved. Skills training and activities to promote employment will also be held. These aspects will thereby ensure and expand employment. Thanks to all these efforts, we have the confidence and determination to ensure employment.

Nevertheless, we must understand that employment pressure will continue to exist regarding its total number. The number of college graduates will hit 11.58 million in 2023, while structural issues surrounding difficulty in hiring and finding jobs remain serious. Moreover, the challenge of hiring general workers and the shortage of technical workers persist. We will actively solve the most pressing difficulties of deep concern to the people regarding their employment, such as more job opportunities, more reasonable work remuneration, and more reliable social insurance. 

Just as you mentioned, the period following the Spring Festival sees a significant flow of workers, and businesses and enterprises usually resume their production after the holiday. This is, therefore, a crucial time for us to step up efforts to ensure employment. We have worked with relevant departments to launch the "Spring Breeze Action" initiative, offering people employment opportunities by holding job fairs online and offline nationwide. In this way, both ends of labor transfer will cooperate closer, facilitating migrant workers to find jobs, especially those lifted out of poverty.

The job market has been stable and progressing steadily in the first two months of this year, which is better than expected. Compared with previous years, it has three notable features. First, the laborers left for work early. On the first day of the Chinese Lunar New Year, some migrant workers already left their hometowns for work, hoping to resume their posts early. Second, companies have started their recruitment efforts earlier than in previous years. Many enterprises initiated employment negotiations before the Spring Festival holiday, with tailormade workforce being arranged right after the holiday, hoping to begin work and production as soon as possible. Third, recruitment activities have been busy. Job fairs across the country have been bustling with crowds, and there has been a significant increase in job seekers. As of the end of February, 46,000 recruitment service activities have been held, and 32 million job positions have been posted, indicating a promising start for China's employment situation this year.

Moving forward, we will prioritize stabilizing employment and view it as a primary political task. We will fully implement various measures to stabilize the job market, including stabilizing existing employments, expanding new job opportunities, improving quality, and ensuring basic employment needs. Our efforts to stabilize employment will be unwavering. We will strengthen support for enterprises to overcome difficulties and provide targeted assistance to the service sector, small- and micro-sized enterprises, and self-employed businesses, all with large employment capacities, to stabilize and expand their workforce. We will ensure our employment policies are targeted and implemented efficiently to benefit those enterprises directly. We will strengthen support for innovation and entrepreneurship and encourage business startups among key groups. We will also create a better market environment for casual laborers and fully implement our policies to protect the rights and interests of laborers engaging in new kinds of jobs. We will strengthen our efforts to provide targeted policies, expand market-based employment avenues while stabilizing the scale of job positions in the public sector, and ensure young people including college graduates can find jobs or start their own businesses. We will support people in rural areas to find jobs outside their hometowns or in nearby places so as to stabilize employment for rural workers including those lifted out of poverty. We will assist job seekers and provide a subsistence allowance for those in need, ensuring that their basic living needs are met. We will increase quality and efficiency in improving the public service system for employment and organize professional training programs in large scale to balance supply and demand in the job market. We will also strengthen comprehensive job market regulation to protect laborers' lawful rights and interests.

In summary, we have confidence in achieving our employment targets for the year and maintaining a stable job market.

CCTV:

The more than 1.3 billion social security cards issued in China have been playing an increasingly crucial role. Are there any recent updates regarding social security cards that you would like to share with us? Additionally, what steps will your ministry take to improve the work in this area?

Wang Xiaoping:

Thanks for your questions. Vice minister Li Zhong, responsible for social security work, will answer them.

Li Zhong:

I appreciate your interest in our work. The social security card is an essential way for people to access public services related to their livelihoods. In recent years, we have been working with stakeholders to promote the development of a multi-functional, all-in-one card for various public services. We have been continuously enhancing its functions, and our progress can be observed in the following four aspects:

First, we have comprehensively integrated features related to human resources and social security. People can access a total of 95 services with their cards, including employment registration, professional training, social insurance payments, and pension withdrawals, providing convenient services for the public. 

Second, we have been exploring possible features related to people's livelihoods that can be incorporated into the social security card. Many regions in China have introduced government services, medical services, transportation, sightseeing, cultural experiences, and government subsidies for urban and rural residents. Currently, the physical social security card allows for trans-provincial settlement of medical bills in all prefecture-level regions across China. Nearly 70 prefecture-level regions allow for the settlement of medical services and medicine purchases through an electronic social security card. Nearly 200 prefecture-level regions use social security cards to grant urban and rural residents financial subsidies. In some regions, people can use the card to pay public transportation fees, borrow books from libraries, and enter parks and tourist attractions. The public have benefited from the integration of so many features.

Third, we have been coordinating the development of both physical and electronic versions of social security cards. While ensuring that physical cards are issued to the general public, we are also speeding up the introduction of electronic cards. More than 740 million Chinese people have obtained electronic cards, the online service enabled by which runs parallel to the offline service provided by physical cards and provides the public with enriched experiences of high-efficiency smart services.

Fourth, we have actively promoted the regional "all-in-one card" services. For example, we have promoted regional cooperative legislation in the three provinces and one directly administered municipality in the Yangtze River Delta and explored new methods to achieve the "same treatment in different cities" for public services. In Sichuan province and Chongqing municipality, we have realized over 30 cooperative services regarding human resources and social security based on social security cards. Moreover, by using social security cards as a carrier, we have built a regional book rental system, allowing people to use their social security cards to borrow and return books in both regions. Hainan and Guangdong provinces have jointly issued such "all-in-one cards," which combine a social security card with an annual travel card, realizing the "same treatment in different cities" for cross-provincial travel consumption and enabling the public in these two provinces to enjoy the benefits of the "all-in-one cards."

In the next step, we will take social security cards as the carrier and promote the "all-in-one cards" for residents to enjoy various services. We will attach more nationwide service applications to the "all-in-one cards" and strive to use more data to benefit people and make the cards more convenient for the public. Thanks.

21st Century Business Herald:

People from all walks of life are concerned about pensions. What is the general situation of basic old-age insurance funds for enterprise employees? Thank you.

Wang Xiaoping:

Pensions, involving the vital interests of hundreds of millions of retirees, have attracted wide attention from the public. In recent years, the reform of the pension insurance system has steadily advanced. Its coverage keeps expanding, and the revenue of the insurance funds continues to increase. The system is running smoothly on the whole, and has a strong ability to guarantee payments. This can be seen in the following four aspects. First, the balance between revenue and expenditure has been maintained. The annual revenue and expenditure of basic old-age insurance funds for enterprise employees are basically balanced, and the funds have been operating smoothly in general. Second, the funds have been well regulated. In order to solve the structural problem of uneven fund distribution, and based on the central regulation system for basic old-age insurance funds, a national coordination system was launched last year to regulate funds nationwide with stronger efforts. Third, there has been financial input. Central government financial subsidies continue to increase, and local financial departments have established a long-term investment mechanism to increase their input. Fourth, there are long-term reserves. National social security funds continue to expand, and the transfer of part of state-owned capital to the social security funds has been completed. These two funds are long-term reserves for the source of pension payments. So, it's clear that China's old-age insurance funds are stable. Thank you.

Radio Television Hong Kong (RTHK):

With the mainland experiencing negative population growth for the first time in 60 years, are you concerned about its potential impact on China's future economic growth? Thank you.

Yu Jiadong:

You mentioned the problem of population decline. From an employment perspective, this relates to its impact on the labor force supply. According to the National Bureau of Statistics, China's working-age population between the ages of 16 and 59 declined to 876 million at the end of last year, down from a peak of 920 million. The decline in the labor force occurred amid an overall abundant supply, and China remains a developing country with the world's largest population and labor force. In terms of the labor structure, the decline is mainly because older workers are withdrawing from the labor market, and their number has declined rapidly. In contrast, the young labor force has increased steadily. It is estimated that 16.62 million young people will enter the job market in urban areas this year, reaching a new high in recent years. And the pressure on total employment is still high.

In the next step, we will continue to implement the employment-first policy, strengthen economic development in an employment-oriented way, expand employment capacity, alleviate structural problems in employment, strive to improve the quality of employment, and achieve full and high-quality employment to facilitate sound economic development. Thank you.

Cover News:

The private pension mechanism has been officially implemented in some pilot areas. I want to ask, how is this work progressing? Thank you.

Li Zhong:

I appreciate your concern about the issue of private pensions, which is a significant concern for all. The media have given much attention to the issue. Last year, we held a press conference on private pensions in this briefing hall, introducing the upcoming private pension mechanism. It's my pleasure to take this opportunity to share more information with you all since it has been ongoing for a while. 

A private pension mechanism is a supplementary endowment insurance program supported by government policies, voluntarily participated in by individuals, and operated in a market-oriented manner. It is an important institutional arrangement of a multi-tiered endowment insurance system. Our multi-tiered endowment insurance system consists of three levels, commonly called "three pillars." The first pillar is basic endowment insurance; the second is enterprise annuity and occupational annuity; the third is private pensions, including other personal commercial pension services. Both the second and third pillars have served as effective supplementary pension programs to the first.

Last year, China took the symbolic move to officially launch the private pension mechanism, which marked the multi-tiered and multi-pillared endowment insurance system taking shape. The construction of the private pension mechanism has demonstrated the following characteristics.

First, preferential policies provide support. At present, these policies have mainly manifested in three stages. At the payment stage, the payment amount will be deducted before personal income tax. Meanwhile, investment income is not taxed and is taxed at a lower tax rate of 3% when received. Moreover, the upper limit of the annual contribution is 12,000 yuan, which will be adjusted in due course.

Second, there is a variety of products to choose from. Relevant regulatory authorities have approved 137 public funds, 19 commercial pension insurances, 18 wealth management products, 465 savings deposit products, and other personal pension investment products following safety norms and the requirements of focusing on long-term preservation and appreciation. Participants can choose products based on their own investment preferences. With the system's expansion, investment products will become even more diverse.

Third, the services are more convenient. The Ministry of Human Resources and Social Security has led the creation of a private pension information service platform. Each participant on the platform has an individual account with multiple functions, including information recording, inquiry and other services. Through this, they can intuitively observe the condition of their private pension. Participants can access this information service platform directly through many channels, such as the national social insurance public service platform and electronic social security card. They can also open accounts, pay fees and purchase financial products through commercial banks.

At the end of last year, a total of 36 pilot cities and regions introduced the private pension mechanism. Thanks to the concerted efforts of all parties and the active participation of the public, 28.17 million people participated in the project within three months of its implementation.

The private pension system is a brand-new system. In the next step, we will follow the requirements made in the previous year, work with relevant departments to further promote and elaborate policies, sum up experience, improve relevant policies, and accelerate the implementation of the system in an active yet stable manner. 

The Paper.cn:

The report to the 20th CPC National Congress pointed out that we will further improve the multi-tiered social security system that covers the entire population in urban and rural areas and see that it is fair, unified, reliable, well-regulated, and sustainable. I want to ask, what measures will be taken to improve the construction of the social security system? Thank you. 

Wang Xiaoping:

Thank you for your question. The social security system provides a safety net for people's livelihoods and helps ensure social stability. Since the 18th CPC National Congress, the CPC Central Committee with Comrade Xi Jinping at its core has placed greater emphasis on developing the social security network. The committee has strengthened top-level design, continued to deepen reforms and rolled out a series of significant and crucial reform measures. For instance, we have established a unified basic pension insurance scheme for rural and non-working urban residents and brought government office and public institution pension schemes into line with enterprise schemes. The social security system has undergone continuous improvement in terms of its uniformity and standardization. The government launched a nationwide program for the unified management and adjustment of pension insurance funds for urban workers, and the functions of mutual assistance and redistribution were further strengthened. The enterprise annuity and personal pension systems were put in place, and the framework of a multi-level pension insurance system was established. In addition, occupational injury insurance trials have been conducted, and the government is actively exploring expanding insurance coverage for employees in new business forms. The government is also promoting building a "three-in-one" system of work-related injury insurance, which encompasses prevention, compensation, and rehabilitation, and further highlighting the functions of unemployment insurance to protect life, prevent unemployment and promote employment. The systematic, integral, and synergistic nature of the reform has been strengthened, providing people with corresponding institutional guarantees against risks such as old age, unemployment, work-related injuries, and poverty.

The report to the 20th CPC National Congress emphasized the need to further improve the multi-tiered social security system that covers the entire population in urban and rural areas and see that it is fair, unified, reliable, well-regulated, and sustainable. This fully reflects the deep understanding of the CPC Central Committee with Comrade Xi Jinping at its core on the developmental laws of social security in the new era and provides us with a fundamental guideline. We will focus closely on meeting these requirements and implementing them earnestly. There are several key tasks, which can be summarized as "one expansion," "two improvements," and "three upgrades."

"One expansion" refers to expanding the coverage of social insurance programs. Specifically, it involves further implementing full coverage of social insurance and expanding coverage precisely based on the characteristics of key groups, such as employees working in new forms of business and migrant workers, through the implementation of classified policies. We need to improve insurance policies for workers in flexible employment at their place of employment and encourage more workers in flexible employment to participate in the basic old-age insurance funds for employees. Additionally, we need to steadily implement trials of occupational injury insurance for people in new forms of employment.

"Two improvements" refer to two areas of improvement. The first area is to improve the multi-level pension insurance system. This involves deepening the reform of basic pension schemes, exploring measures to expand the coverage of enterprise annuities, actively and steadily implementing the personal pension system, and meeting the diverse pension needs of the people. The second area is to improve the adjustment mechanism for social insurance benefits, allowing people to better share the benefits of economic and social development.

"Three upgrades" refer to three areas that need to be improved. The first upgrade is to enhance the level of unified management. This includes promoting the unified national management of enterprise pension insurance, increasing fund adjustments, and promoting unified provincial-level management of unemployment and work-related injury insurance. The second upgrade is to strengthen the ability to supervise funds. This involves further strengthening the "four-in-one" risk prevention and control system for policy, operations, information, and supervision, organizing and launching special actions for fund management, and enhancing investment supervision. The third upgrade is to improve the quality of service. This means improving the unified national social insurance public service platform with the social insurance card as the carrier, establishing an all-in-one card system, and promoting the handling of more high-frequency matters through a single network and across provinces, aiming to minimize inconvenience for the public. Mr. Li Zhong has introduced the application of the all-in-one card in Sichuan, Chongqing, Hainan, Guangdong, and other places. The "three provinces and one city" (Jiangsu province, Anhui province, Zhejiang province, and Shanghai city) in the Yangtze River Delta region have developed coordinated legislation and compiled a list of items to clarify social security services. Cardholders can therefore enjoy corresponding benefits in social security, transportation, cultural tourism, employment, financial services, and other fields. Moreover, the innovative application of social security cards can be further expanded in various economic and social areas. These are valuable experiences that need to be summarized and promoted.

Next, we will prioritize the improvement of the social security system as a means of achieving common prosperity. This will lay a solid foundation to make people's well-being more secure while promoting the high-quality and sustainable development of social security. Thank you.

CRNTT:

The scale of China's college graduates continues to expand, reaching a record high again in 2023. How will you promote the employment of college graduates and other young people? Thank you.

Wang Xiaoping:

I would like to thank the reporter from Hong Kong for their interest in the employment of mainland college graduates. I would like to ask my colleague, Mr. Yu Jiadong, to give you an introduction.

Yu Jiadong:

College graduates are an invaluable human resources for any country. The CPC Central Committee and the State Council have always attached great importance to the employment of college graduates, introduced a series of policies and measures, and held special meetings every year to promote their implementation. Various regions, relevant departments and aspects of society have done a lot of work. As you said, the number of college graduates will reach 11.58 million in 2023. The task of promoting employment has become even more onerous. We will insist on placing the promotion of youth employment, especially for college graduates, in a more prominent position, as well as introduce stronger policies, expand positions, improve services, help those most in need, and work with relevant departments to do a good job. The focus is on four areas:

First, we will strengthen our efforts to expand channels. We will further improve the policies for supporting employment and entrepreneurship among graduates, launch special actions to provide policy services, expedite policy delivery, stabilize and expand recruitment in state-owned enterprises, stabilize recruitment at public institutions and grassroots projects, encourage graduates to seek employment in micro, small and medium-sized enterprises (MSMEs) as well as at the community level in urban and rural areas, and support independent entrepreneurship and flexible employment for graduates. At the same time, we will guide localities in adjusting and optimizing the scheduling of examinations including professional qualification examinations, to leave graduates more time to find jobs.

Second, we will strengthen our efforts to promote employment opportunities. We will continue to promote public employment services on campus, offering graduates job information, guidance, training, entrepreneurial support and other services. At the same time, we will launch a series of special service activities called "Vocation Leads to the Future," mobilize industry associations, social organizations and well-known enterprises to participate extensively, combine online and offline and push job opportunities on a large scale. We will launch more industry-specific recruitment to provide graduates with ample job information.

Third, we will strengthen internship training. We will continue to implement the plan to offer 1 million high-quality internship positions, launch a number of national internship demonstration units to improve the practical ability of graduates. In response to the career development needs of graduates, we will actively organize skills training, improve the quality of training, expand training for new occupations, and support graduates in attaining skilled employment.

Fourth, we will try to assist and support those in need. For graduates seeking employment, we will provide information in advance, keep records of our assistance and support work, smoothen various channels for help, and track graduates based on real-name-based services. Additionally, we will beef up support to graduates from families living in poverty, families living on subsistence allowance, zero-employment families, and those facing other difficulties such as disabilities by offering them services and job recommendations. We will promptly integrate unemployed young people into employment and unemployment management services. We will also strengthen guidance and category-based assistance for people who are long-term unemployed to help them better enter the job market. 

In a nutshell, we will work tirelessly to help college graduates and other young people find steady employment. Thank you. 

Shou Xiaoli:

Due to the time limit, we will have one last question. 

Hong Kong Bauhinia Magazine:

Enhancing vocational training and cultivating more skilled workers are essential to easing recruitment and employment difficulties. What measures will the MOHRSS take in this regard? Thank you. 

Wang Xiaoping:

This is a good question. Improving vocational skills is the key solution for addressing the dual problems of enterprises' difficulty in recruitment and workers' difficulty in finding employment. This also serves multiple purposes, as improving workers' vocational skills is conducive to promoting the transition from a demographic dividend into a human resources dividend. It also empowers more ordinary workers to join the middle-income group through hard work. 

The report to the 20th CPC National Congress emphasized improving the system of lifelong vocational training and tackling structural unemployment . Last year, the General Office of the CPC Central Committee and the General Office of the State Council issued guidelines on strengthening the cultivation of highly-skilled workers, which we will earnestly implement. To enhance vocational training, we will stabilize the scale, take care of the whole process, focus on key areas, improve the system, boost effectiveness, and roll out incentivizing measures.

As for stabilizing the scale, we will continue to organize large-scale vocational training. The three-year campaign for upgrading vocational skills has provided more than 83 million subsidized training opportunities. During the 14th Five-Year Plan period (2021-2025), we will offer more than 75 million government-subsidized training opportunities for all urban and rural workers. 

As part of taking care of the whole process, we will launch extensive multi-tiered vocational training for workers across stages from study to work. We will organize pre-employment training for new entrants to the workforce, on-the-job training for enterprise employees, and training for the unemployed to help them find new jobs. In this way, we will improve workers' ability to apply for and choose a job, stabilize their employment, and secure their reemployment. 

To focus on key areas, we will boost China's strength in manufacturing, product quality, cyberspace, and digital development . We will intensify the cultivation of skilled workers in key areas. We will thoroughly carry out programs to strengthen skills in the manufacturing sector and expand the workforce of skilled personnel. We will concentrate on key groups, including college graduates, rural migrant workers, and people who have difficulty finding employment, and offer a range of vocational training programs. We will center on scaling up assistance to certain regions in pursuing rural revitalization and arrange training for rural workers, especially those lifted out of poverty, to help them move into non-agricultural jobs.

Improving the system means improving the vocational skill training system, increasing the supply of training, and enhancing a joint and shared training mechanism. We will promote a diversified training pattern combining government-subsidized, enterprise-initiated, and market-oriented training. We will vigorously develop vocational education, skilled worker education, and the construction of public training bases. In addition, we will comprehensively promote a training model of integrating work and study to build skills.

Boosting effectiveness means improving the quality of training effectively. We should respond to workers' diverse and differentiated needs to promote employment and entrepreneurship. We should adapt to industrial transformation, upgrading, and technological advancements and adjust training content promptly. We should direct training resources to focus on areas that are urgently needed by the market and crucial for enterprise production. Additionally, we should strengthen standardized management, fund supervision, and service guarantees for training.

Incentivizing and driving involve encouraging and guiding workers to love and devote themselves to their skills, to become skilled talents, and serve the country with their abilities. We will vigorously promote the model worker work ethic, the spirit of labor, and quality workmanship, inspiring workers to strive for the new journey and adhere to the idea that labor creates value. We will encourage them to "do what they love and love what they do, specialize in their craft, and become skilled at their work." We will improve the evaluation and incentive mechanisms, implement the "New Eight-Grade Worker" vocational skills level system, and strengthen the skill-value incentive orientation regarding salary income distribution. Before this year's Spring Festival, I visited a plant of the Beijing North Vehicle Group, where I met with several vocational-skilled talents. Ma Xiaoguang is a guiding role model for many young people due to his growth experience. Born in 1980, Ma enrolled in the vehicle plant's vocational education school at 15. After graduation, he started as an apprentice and made significant technological breakthroughs, such as CNC machine tools, while winning numerous invention awards. His skills and theoretical knowledge are highly regarded, and he has published many academic articles. Currently, he is the chief technician of the vehicle plant and a senior engineer in this field. He has two potential pathways for career advancement. According to plant management, his treatment is equivalent to that of a vice president. This type of career path plays an important role in developing and motivating skilled professionals. We will also improve the vocational skills competition system and drive job position training and skills competitions. Recently, the latest season of "Craftsmen of the Nation," produced by CCTV, showcased the inspiring stories and advanced skills of 10 individuals. I urge the reporters here to highlight the growth experiences of typical figures like them and promote their craftsmanship, spirit and values throughout society. This year, we will hold China's second Vocational Skills Competition in Tianjin, and we welcome everyone to follow the event closely. Thank you.

Shou Xiaoli:

Thank you, Ms. Wang Xiaoping, thank you to all the speakers, and thanks to all the journalists. Today's press conference has now concluded. Goodbye, everyone.

Translated and edited by Zhu Bochen, Zhou Jing, Gong Yingchun, Guo Yiming, Yan Xiaoqing, Qin Qi, Wang Yiming, Liu Caiyi, Xu Xiaoxuan, Wang Wei, Zhang Junmian, Liu Sitong, Yang Xi, Huang Shan, Li Huiru, He Shan, David Ball, Tom Arnsten, and Jay Birbeck. In case of any discrepancy between the English and Chinese texts, the Chinese version is deemed to prevail.

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Read in Chinese

Speakers:

Mr. Jin Zhuanglong, minister of industry and information technology 

Mr. Xin Guobin, vice minister of industry and information technology 

Mr. Tian Yulong, chief engineer and spokesperson of the Ministry of Industry and Information Technology (MIIT)

Chairperson:

Ms. Shou Xiaoli, deputy director general of the Press Bureau of the State Council Information Office (SCIO) and spokesperson of the SCIO

Date:

March 1, 2023

Shou Xiaoli:

Ladies and gentlemen, good afternoon. Welcome to the press conference held by the State Council Information Office (SCIO). This is the sixth press conference in the series "Embarking on the New journey — A Government Perspective." We have invited Mr. Jin Zhuanglong, minister of industry and information technology, to brief you on promoting new industrialization to bolster the real economy, and to take your questions. Also present at today's press conference are Mr. Xin Guobin, vice minister of industry and information technology, and Mr. Tian Yulong, chief engineer and spokesperson of the MIIT.

Now, let's give the floor to Mr. Jin Zhuanglong for his introduction.

Jin Zhuanglong:

Friends from the media, ladies and gentlemen, good afternoon. Thank you for your long-term interest in China's industrial development as well as your care and support for the MIIT. Today, my two colleagues and I will talk with you about implementing the major decisions and arrangements of the 20th CPC National Congress and promoting new industrialization to bolster the real economy.

The report to the 20th CPC National Congress draws a grand blueprint for comprehensively building a great modern socialist country and advancing the rejuvenation of the Chinese nation on all fronts through a Chinese path to modernization. It states that China will basically achieve new industrialization by 2035. It also underlines that in pursuing economic growth, we must continue to focus on the real economy and that we will advance new industrialization and move faster to boost China's strength in manufacturing and cyberspace . Made by the CPC Central Committee with Comrade Xi Jinping at its core based on the overall development of the Party and state, the major strategic arrangement of advancing new industrialization is of great and profound significance. In my opinion, advancing new industrialization is a natural requirement for realizing a Chinese path to modernization, a fundamental support for comprehensively building a great modern socialist country, an urgent need to build up competitive edges as a major country, and a strategic choice to realize high-quality economic growth. 

Since the 18th CPC National Congress, under the strong leadership of the CPC Central Committee with Comrade Xi Jinping at its core, China's new industrialization has been developing at a markedly faster pace. I will brief you on this from five aspects:

First, the industrial system has been further improved. China boasts 41 major industrial categories, 207 intermediate industrial categories and 666 small industrial categories, being the only country in the world that has all the industrial categories in the United Nation's International Standard Industrial Classification of All Economic Activities . 

Second, the industrial scale has been further expanded. In 2022, the total value-added of industry exceeded the 40 trillion yuan mark, accounting for 33.2% of GDP. Therefore, we often say that industry serves as a ballast of macroeconomic performance. Specifically, the value-added of manufacturing made up 27.7% of GDP and the manufacturing scale has topped the world for 13 consecutive years. A total of 65 Chinese manufacturing enterprises made it onto the 2022 Fortune Global 500 list, and China now has more than 70,000 small- and medium-sized specialized and sophisticated enterprises that produce new and unique products. 

Third, the industrial structure has been constantly optimized. The high-tech manufacturing industry and equipment manufacturing industry accounted for 15.5% and 31.8% of the value-added of industries above designated size, respectively. The output of new-energy vehicles and photovoltaic power has topped the world for many years in a row. The transformation and upgrading of traditional industries has been accelerated, with marked progress being made in their digital and green transformations. A total of 45 national advanced manufacturing clusters have been fostered. 

Fourth, the digital economy has been growing at a faster pace. China's mobile communications have made leapfrog developments by following other countries in 2G, making breakthroughs in 3G, keeping pace with the rest of the world in 4G, and securing a leading position in 5G. Currently, China has built the world's largest mobile communications network with advanced technology. As of the end of 2022, China had built a total of 2.31 million 5G base stations. Thanks to this, all counties in China can now access 5G services and all villages can access broadband internet. Data centers in use nationwide now have more than 6.5 million standard racks, with the total computing power ranking second in the world. The numerical control rate of key processes and the penetration rate of R&D and design tools for digital transformation in key industrial enterprises reached 58.6% and 77%, respectively. In 2022, the income of the software industry exceeded 10 trillion yuan, and the industrial internet was applied in 45 major categories of the national economy, with the number of influential industrial internet platforms reaching 240.  

Fifth, a series of major advances has been secured in key areas. One achievement after another has been made in such fields as manned spaceflight, lunar and Martian exploration, and deep sea and deep earth probes . The first C919 large passenger airliner was delivered, the first self-developed F-class 50 megawatts heavy-duty gas turbine was ignited, and nuclear power units using Hualong One technology were connected to the grid and started operation.  

Currently, new industrialization also faces new situations in its development: a new round of scientific and technological revolution and industrial transformation has advanced by leaps and bounds, the global industrial structure and layout have undergone profound changes, and China is at a crucial juncture of moving from a big manufacturer to a strong manufacturer. We will adhere to the guidance of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, and thoroughly implement the guiding principles of the 20th CPC National Congress. We will act on the general principle of pursuing progress while ensuring stability, apply the new development philosophy, create a new development pattern, and promote high-quality development. We will coordinate development and security, make solid progress in advancing new industrialization, move faster to boost China's strength in manufacturing and cyberspace, and continuously lay a solid material and technological foundation for comprehensively building a great modern socialist country. This work will focus on six aspects:

First, we will promote the stable growth of the industrial economy. We will earnestly implement the policy package aimed at stabilizing the economy and the related follow-up measures. Our primary focus should be on stabilizing the growth of key industries, which contributes significantly to GDP. Meanwhile, we will also give better play to key areas and better leverage the anchor role of industries in stabilizing the macroeconomy.

Second, we will accelerate the modernization of the industrial system mainly through four aspects. Specifically, we need to transform and upgrade traditional industries because they account for a significant proportion of all industrial sectors. In addition, we need to cement the leading position of several competitive industries in China, develop emerging industries, and make forward-looking plans for future-oriented industries.

Third, we will enhance the resilience and security capacity of industrial and supply chains. We will work to shore up weak links, leverage advantages, and strengthen the development foundation. We will see that key industrial and supply chains are more self-sufficient and that their risks are better controlled while promoting the development of all industrial chains.

Fourth, we will improve the mechanism for industrial sci-tech innovation. The relations among science and technologies, industries, finance and innovation have become a common concern, and we need to strengthen collaboration in these aspects. We will promote breakthroughs in core technologies in key fields and comprehensively stimulate the drive for innovation and entrepreneurship. We will also build several innovation centers for the manufacturing sector, develop several advanced manufacturing clusters, and facilitate the in-depth integration among links concerning innovation, industrial development, capital and talents.

Fifth, we will focus on promoting high-end, intelligent, and green manufacturing. We will strengthen brand building as well as carry out smart manufacturing projects. We will also expedite the construction and application of new types of information infrastructure and promote the green and low-carbon development of industries proactively and steadily.

Sixth, we will comprehensively improve the competitiveness of enterprises. Enterprises are the main body of the market. We will support leading enterprises in improving development quality, nurture more specialized and sophisticated small- and medium-sized enterprises (SMEs) that produce new and unique products, and create a fine ecosystem where businesses of all sizes can pursue development through collaboration.

That concludes my brief introduction. Next, my colleagues and I will take your questions. Thank you.

Shou Xiaoli:

Thank you, Mr. Jin. Now the floor is open for questions. Please identify the media organization you work for before raising your questions.

China Daily:

The report to the 20th CPC National Congress proposed modernizing the industrial system, and the central economic work conference made further arrangements. Could you please elaborate on MIIT's plans and priorities for modernizing the industrial system? Thank you.

Jin Zhuanglong:

Thank you for your questions. The 20th CPC National Congress made comprehensive arrangements to modernize the industrial system, and General Secretary Xi Jinping also made important remarks on the issue at the Central Economic Work Conference held last December.

As we know, the manufacturing industry is the foundation of the real economy. It is also the lifeblood of the national economy and a crucial sector in constructing a modern industrial system. China has developed a large-scale and complete manufacturing system with strong competitiveness. We will stay committed to developing the real economy, especially the manufacturing industry, consolidate the advantage of our complete industrial system, and ensure that its share of the industrial sector remains generally stable. We will expedite efforts to modernize the industrial system by leveraging advantages, shoring weak links, and strengthening the development foundation. This endeavor will mainly focus on the following four aspects.

First, we will transform and upgrade traditional industries. As traditional industries are the foundation of a modernized industrial system and account for over 80% of China's industrial sector, we will ramp up efforts to support enterprises in accelerating technological transformation and upgrading equipment. We will also promote the adoption of advanced and applicable technologies, modernize techniques, and elevate product quality to meet higher-end standards. We will carry out a campaign In the manufacturing industry to increase the variety of products, improve quality, and build brands, in a bid to raise product quality and brand benefits. We will implement smart manufacturing projects, speed up the growth of service-oriented manufacturing, and strive to bolster producer services. We will implement the plan to achieve peak carbon emissions in the industrial sector, comprehensively promote green manufacturing, and encourage green and low-carbon development. By promoting market-oriented and rule-of-law methods, we aim to encourage the merging and restructuring of major sectors and enhance industrial concentration. 

Second, we will consolidate and expand the development of competitive industries. China has developed distinctive competitiveness in sectors such as high-speed rail, ships, electronic power facilities, construction machinery and communication equipment. China's production of major products like personal computers, cellphones, home appliances, and solar panels also accounts for over half of the world's total. We will coordinate resources and ramp up efforts to implement two projects. The first project involves upgrading the foundational industrial infrastructure, which requires consistent and dedicated efforts. The second involves achieving breakthroughs in key technologies and equipment. We will consolidate and enhance the strength of all industrial links and develop several brands for "Made in China." We will also leverage the major role of enterprises, support leading enterprises in improving development quality, and nurture several world-class companies. In addition, we will take special action to develop advanced manufacturing clusters, build world-class advanced manufacturing clusters focusing on key sectors such as construction machinery, rail transit, optoelectronic information, energy and electric power facilities, and textile and apparel products.

Third, we will foster emerging industries. Emerging industries are the new pillars and fields that will lead development in the future. We will keep developing and expanding new application scenarios in key sectors such as 5G, artificial intelligence (AI), biological manufacturing, the industrial internet, intelligent connected vehicles, and green and low-carbon development. We will build more national industrial innovation centers in emerging industries. We will also implement the "Robot + Application Action Plan" and promote large-scale and intensive development in the Internet of Things (IoT) sector.

Fourth, we will proactively plan and create a layout for industries of the future. Seizing opportunities created by the latest round of technological revolution and industrial transformation, we will harness the industries of the future to become a leading force for development. We will study and formulate an action plan to speed up development on frontiers such as humanoid robots, the metaverse, and quantum science and technology and comprehensively advance the development of 6G technology. We will also encourage local authorities to experiment in this regard and make forward-looking arrangements. 

In conclusion, we must promote domestic and international circulation to build a modern industrial system, with the former as the mainstay. Moreover, we need to strengthen global cooperation, deepen reform and opening-up, create a favorable business environment, and better serve advanced manufacturing enterprises, whether Chinese or foreign. Thank you. 

Nanfang Daily:

2022 witnessed explosive growth in China's new energy vehicle (NEV) industry, with production and sales exceeding 6.5 million. Will the momentum be sustained this year? What measures will the MIIT take to advance the industry's sound development? Thank you.

Jin Zhuanglong:

Thank you for your question. It is indeed a topic of public interest. I want to pass it on to Mr. Xin Guobin, who oversees this sector. 

Xin Guobin:

Thank you for your attention, care, and support in developing the NEV industry. Under the strong leadership of the CPC Central Committee and the State Council, relevant parties made determined efforts to seize a remarkable performance of the NEV industry last year. The sector's annual production reached 7.05 million units and sales hit 6.88 million, increasing 96.9% and 93.4%, respectively, year on year. China's production and sales volume of NEVs has topped the world for eight consecutive years. 

Since China issued the "Energy Saving and New Energy Vehicle Industry Development Plan" in 2012, its compound annual growth rate has reached 87%. A total of 15.96 million NEVs have hit the road, making China a leading force in the electrification of the global automobile industry. The public is closely watching the trend of the industry, a sector blessed with a possible take-off. Attaching great importance to its development, the MIIT organized a series of surveys and seminars to solicit opinions from enterprises, research institutes, and industry associations. It turned out that NEV producers were very confident about the industry's development this year. All sides believe that the fundamentals sustaining China's steady and long-term economic and social growth remain unchanged. Their enthusiasm for implementing the spirit of the 20th CPC National Congress and forging ahead with a pioneering and enterprising spirit runs unprecedentedly high. It was also found that green development had taken root, and customer satisfaction with NEVS has steadily improved.

On the basis of a comprehensive assessment of the above factors, as well as production and sales in the past two months, we believe that the sound momentum of the NEV industry will be sustained and stable growth is in sight. We will improve our work in the following five aspects to make it happen.

First, we will strengthen overall planning and upgrade the inter-agency mechanism for developing the NEV industry. We aim to ensure progress in electrification, internet connection and smart technology. Continuous efforts will be exerted to achieve technological breakthroughs, advance applications and reinforce infrastructure. All these efforts will be aimed at building world-class innovative Chinese brands with firmly integrated capacities.

Second, we will support innovation. We will launch major initiatives to enable leading enterprises to fully play their leading role and strive for breakthroughs in the technologies of new system batteries, automotive chips, and vehicle operating systems, and accelerate their industrial application. We will start permitting intelligent connected vehicles to enter the market and pilot their operation. We will also speed up the application of 5G vehicle-road networking technology to realize the integrated development of electrification and intelligent connection.

Third, we will promote popularization. We have jointly issued a notice with relevant departments to pilot the comprehensive electrification of public vehicles. We plan to enhance the electrification level of official vehicles, taxis, mail and sanitation trucks. We will work with other departments to roll out purchase tax reduction and exemption policies as soon as possible, amend the dual-credit scheme, and stabilize market expectations. 

Fourth, we will improve service capabilities. We will bolster the development of domestic resources, stabilize global cooperation, and ensure supply and price stability for critical raw materials. We will also improve the recycling system and tackle critical technologies concerning intelligent disassembly to get power batteries better recycled. 

Fifth, we will advance open development. We will continue implementing open policies for the highly internationalized automobile industry. Giving full play to bilateral and multilateral cooperation mechanisms, we will support exchanges between enterprises, research institutes and industrial organizations and encourage their cooperation in trade, investment, technology research and development, and a standard establishment for common development. That's all. Thank you.

Jin Zhuanglong:

People interested in the new energy vehicle industry may have wondered about its production and sales volume this year, especially after a bumper year in 2022. Just now, Mr. Xin predicted sustainable sound momentum, painting a promising picture for the industry. Thank you. 

CCTV:

Great importance has been attached to the capacity building of industrial foundation in recent years, and we have developed a number of major equipment of vital importance to our country. The report to the 20th CPC National Congress proposed carrying out industrial foundation reengineering projects and research projects on major technologies and equipment . What specific plans does the MIIT have to accelerate implementing the two projects? Thank you. 

Jin Zhuanglong:

Thank you for your question. Let us invite Mr. Tian, in charge of the major equipment manufacturing industry, to answer this question.

Tian Yulong:

Thank you for your question. Mr. Jin talked about advancing the implementation of the two projects for building a modern industrial system just now. I will further explain. 

The industrial foundation is the basis for developing the manufacturing industry. Major technologies and equipment are a strong driving force in the upgrading of the manufacturing industry. The quality of the industrial foundation and major technologies and equipment reflects comprehensive industrial power and the level of industrial development. In the development of the manufacturing industry, major technologies and equipment play a guiding role in upgrading, while the industrial foundation serves as fundamental support. Therefore, we should bolster both major technologies and equipment and the industrial foundation in a bid to enhance and improve the manufacturing industry. We will give full play to the advantages of the new system for mobilizing resources nationwide and a supersize market. To build a modern industrial system, we will build powerful industrial and supply chains, coordinate industrial foundation reengineering projects and research projects on major technologies and equipment, and jointly establish a system for industrial scientific and technological innovation so as to improve the manufacturing industry's core competitiveness.

In terms of industrial foundation reengineering projects, first, we will focus on advancing the industrial foundation and develop a range of core and basic spare parts, basic components, basic materials, key and basic software, as well as advanced basic technologies. Through methods such as the open competition mechanism for selecting the best candidates to lead key research projects, we will make breakthroughs in a number of key and generic technologies as well as basic products, which strongly support the innovation and upgrading of our industrial system. Second, we will establish a batch of generic technological centers for industrial foundations. Relying on leading enterprises and scientific research institutions that have transformed into enterprises, we will give long-term and stable support for generic technological research, product innovation, and application promotion. Third, we will leverage the guiding role of industrial policies. Giving full play to the national manufacturing industry transformation and upgrading fund and the small- and medium-sized enterprises development fund, we will encourage the investment of social capital and funds in the market. In doing so, we will support the reengineering of the industrial foundation and nurture a batch of specialized and sophisticated enterprises that produce new and unique products. 

In terms of research projects on major technologies and equipment, we will focus on developing high-end, intelligent, and green major technologies and equipment. After several decades of development, China's major technologies and equipment have formed a complete system and gained strong industrial competitiveness. Going forward, we will meet our country's needs in major strategic products and speed up developing major technologies and equipment to be systemic, high-end, intelligent, and green. Especially in the fields of large aircraft, aero-engines, gas turbines, electric power equipment, ships and marine engineering equipment, machine tools, high-end medical equipment, and modern agricultural equipment, we will strive to make breakthroughs in a number of innovative and landmark equipment. China has such an industrial foundation and innovative ability. 

Second, we will intensify the demonstration and application of industries and industrial applications. Leveraging the driving force of major programs, major equipment, and complete machine systems, we will demonstrate and apply major equipment and major basic products and industrialize them to build systems for industrial and supply chains. We will build a range of industrialized bases for major equipment as well as industrial clusters based on major advantageous areas and industrial cluster areas. 

Third, we will further optimize a policy support system. Currently, we have established a working mechanism for coordinated advancement in major technologies and equipment with relevant departments, made full use of fiscal and financial support and guidance, and improved mechanisms on insurance compensation, offering incentives and ensuring that those who have fulfilled their duties can benefit. We will promote the demonstration and application of newly-developed equipment , materials, and software. Meanwhile, we will step up training major equipment personnel; deepen cooperation involving industries, universities, and research institutes; and intensify building a new type of engineering science. We will encourage enterprises to carry forward the spirit of craftsmanship and cultivate more skilled and talented people of a high caliber. In doing so, we will continue to explore new ways to advance the development of new industrialization and accelerate the advancement of the two main projects. Thank you.

Jin Zhuanglong:

Figuratively speaking, on the one hand, we should "touch the sky," and one the other hand, we should "stand on the ground." "Touch the sky" means we should develop major technical equipment that applies cutting-edge technologies. "Stand on the ground" means we should bolster the industrial base. Therefore, to help the manufacturing industry go big, we should "touch the sky" and "stand on the ground" at the same time. Thank you.

China Youth Daily:

The development of small- and medium-sized enterprises (SMEs) has always been a great concern. Especially over the past few years, specialized enterprises that use sophisticated technologies to produce new and unique products have gained great popularity in the market. What is the current development of those enterprises? What creative measures will be taken to support their development? Thank you. 

Jin Zhuanglong:

Thank you for your questions. I would first like to clarify that China has attached great importance to SMEs. The office of the leading group for promoting the development of SMEs under the State Council has been established in our ministry. We have also set up a department invested with the duty to promote the development of SMEs. Therefore, I will answer your questions.

As we all know, SMEs are closely connected with everybody life. As most SMEs are private enterprises, they have been a vital force in improving people's livelihoods and promote the development of the economy. The following industry-specific statistics will give a full picture of the key role played by SMEs in our country: SMEs contribute 50% of the total tax revenue, over 60% of the total GDP, over 70% of the technological innovation, over 80% of the urban and rural employment, and over 90% of the total number of enterprises. We have thoroughly implemented guiding principles of important speeches made by General Secretary Xi Jinping on promoting the development of SMEs and carried out decisions and deployments made by the CPC Central Committee. We have also collaborated with relevant departments and local governments to launch a slew of preferential policies under the leadership of the office of the leading group for promoting the development of SMEs under the State Council.

It's known to all that, the pandemic has posed numerous challenges to many SMEs last year. The country has rolled out various kinds of measures to ease their burdens. In 2022, China's tax refunds, tax and fee cuts, and tax and fee deferrals for small and micro-market entities topped 1.7 trillion yuan. China has also carried out a series of campaigns and fostered 274 national demonstration platforms of public services, especially for SMEs. China has launched a special campaign on the outstanding payments owed to SMEs, helping them maintain steady growth, optimize structures, and strengthen capacities to ensure their sound and robust development. In 2022, an average of 23,800 enterprises were established per day, the number of SMEs exceeded 520 million, and the operating revenue of small- and medium-sized industrial enterprises above designated size exceeded 80 trillion yuan. Notably, a group of specialized and sophisticated enterprises has become highlights in the development of SMEs. The National Conference on Development of Specialized and Sophisticated SMEs was successfully convened last year. General Secretary Xi Jinping attached great significance to the event and sent a congratulatory letter. China has fostered over 70,000 specialized and sophisticated SMEs, with 8,997 classified as "little giants." As for the capital market, the number of specialized and sophisticated SMEs accounted for 59% of the total number of newly listed enterprises last year. An accumulated number of over 1,300 specialized and sophisticated SMEs were listed on A-share, accounting for 27% of the total number of firms listed on the A-share market. Those enterprises have been long-established players in industrial sectors that play a crucial role. They demonstrate their professionalization, refinement, specialization, and innovation. As we all talk about "specialized and sophisticated SMEs," what does this term mean? To sum up, here are four key characteristics: professionalization, refinement, specialization, and innovation.

For the next step, we will deepen our understanding of the guiding principles of the important instructions made by General Secretary Xi Jinping on promoting the development of SMEs. We will implement decisions and deployments made at the 20th CPC National Congress and work unswervingly both to consolidate and develop the public sector and to encourage, support, and guide the development of the non-public sector. We will place equal emphasis on management and services. We should also provide support and ensure development simultaneously. We will launch more preferential policies to help enterprises, provide more services to help enterprises, optimize the business environment to revitalize enterprises and make innovations to underpin enterprises, making every effort to promote the high-quality development of SMEs. We will lay more focus on the following five aspects.

First, we will enhance the environment for development. Enhancing the environment for development can boil down to a law, a regulation, an opinion, and a plan. The law means we need to fully implement the Law of the People's Republic of China on the Promotion of Small and Medium-sized Enterprises . The regulation refers to the implementation of the Regulation on Ensuring Payments to Small and Medium-sized Enterprises to protect the legitimate rights and interests of SMEs. The opinion means we need to thoroughly act upon the Guiding Opinions on the Promotion of the Healthy Development of Small and Medium-sized Enterprises . The plan means we need to implement the Plan for Promoting the Development of SMEs during the 14th Five-Year Plan Period (2021-25), ensure various preferential policies for enterprises deliver, and ease difficulties for SMEs.

Second, we will increase cultivation efforts. Development is still what really matters to all. We will strengthen the implementation of the gradient cultivation project for competitive enterprises and strive to have more than 80,000 specialized and sophisticated SMEs that produce new and unique products nationwide this year. We will strengthen policy guidance and resources coordination to cultivate about 100 distinctive industrial SME clusters. We will give play to the leading role of large enterprises and support enterprises of all sizes in pursuing development through closer collaboration. This year, we will continue to hold the National Conference on Development of Specialized and Sophisticated SMEs to build a platform for communication and cooperation between SMEs. All friends from the media are welcome to come.

Third, we will improve the service system. Services are a very important part, and the government needs to do more to serve SMEs. There are several aspects in this regard: first, we plan to issue opinions on further improving the service system for SMEs this year; second, we will further improve the public service systems for SMEs at the national, provincial, municipal, and county levels; third, we will continue to carry out the SMEs Service Month activities nationwide to give full play to the role of public service agencies for SMEs, public services demonstration platforms for SMEs, and business startups and innovation demonstration hubs for micro and small enterprises so that more high-quality services can be provided to SMEs directly.

Fourth, we will promote industry-finance cooperation. Financial institutions now attach great importance to financial support for MSMEs. We will guide financial institutions to consistently increase their financing support for MSMEs. We will leverage the role of the capital market to support specialized and sophisticated enterprises in accelerating their listings. We will give play to the guiding role of the National Fund for SMEs Development to stimulate more investment from nongovernmental capital.

We will further improve the overseas service system for SMEs, ensure the success of the SMEs Expo, and build an international cooperation platform to help SMEs make good use of global resources and achieve win-win cooperation. Thank you.

Science and Technology Daily:

The 20th CPC National Congress made a strategic plan for moving faster to boost China's strength in cyberspace, emphasizing the building of a modern infrastructure system. What considerations does the MIIT have in the acceleration of the construction of the next-generation information infrastructure such as 5G, gigabit fiber optic networks, and mobile IoT? Thank you.

Tian Yulong:

Thank you for your question. The Party Central Committee and the State Council have always attached great importance to this issue and have also made strategic arrangements on the construction of new types of infrastructure. With the joint effort of various departments and localities, the construction of new types of infrastructure, such as 5G, gigabit fiber optic networks, and mobile IoT, as you mentioned, has been gaining steam and achieved remarkable results.

In terms of building 5G networks, we have established the world's largest and leading 5G networks. We have more than 2.31 million 5G base stations. The 5G networks cover all prefecture-level cities and all county seats across China. With the continuous improvement of applications and facilities, the supply capacity of 5G networks has also been continuously enhanced, playing a leading role in building a complete industrial chain which covers systems, chips, and terminals. During the 14th Five-Year Plan period, we will continue to increase the depth and breadth of 5G network coverage, further deepen joint construction and sharing of networks, and vigorously promote the integration of 5G technology and its product applications into all walks of life in our economy and society. Moreover, it is necessary to promote the deep integration of "5G plus Industrial Internet" into the manufacturing industry and expand it to all links of production in order to improve the overall level of digitalization, networking, and intelligence in the manufacturing sector.

Regarding the development of 1000M fiber optic networks, we have realized 1000M network coverage in all cities, broadband connections in all villages, and 5G coverage in all counties. The 1000M fiber optic networks already have the capacity to cover over 500 million households, a world-leading figure. The project to channel more computing resources from China's eastern areas to its less developed yet resource-rich western regions is in full swing, gradually building a computing power infrastructure application system that will enable the less developed regions to handle and store data transmitted from the economically advanced areas.

The total number of standard data center racks in service in China has exceeded 6.5 million, and servers have surpassed 20 million, ranking second in the world in terms of total computing power. In the future, we will launch a "Light Chasing Action" of 1000M fiber optic networks to boost the collaborative innovation of cross-industry, cross-enterprise, and cross-regional networks and encourage digital, internet-based and intelligent transformation of traditional industries. We will strive to achieve the coordinated and balanced development of information and communication networks in small and medium-sized cities and remote rural areas, promote the infrastructure construction of broadband access services in border regions and urban cloud networks in small and medium-sized cities, and thereby allow modern information technology to benefit all our people. At the same time, we will step up efforts to encourage the empowerment of computing infrastructure and build a network structure and computing power supply system that integrates cloud and networks and converges computing and networks.

Regarding the mobile Internet of Things (IoT), China has built the largest mobile IoT in the world, with 1.845 billion connections, accounting for more than 70% of the global total. China has become the first major economy in the world with more connected things than people. The mobile IoT has been widely applied to digital city construction, smart manufacturing and transportation, and mobile payments. We all have a deep understanding of this. It has facilitated our lives and changed our way of life.

In the future, we will leverage the enabling role of network, take the application-driven, market-oriented, and policy-motivated approach and further promote the full development of mobile IoT. We will continue to consolidate the leading edge of our network capabilities and build IoT connectivity that supports the integration of fixed and mobile IoT and the combination of broadband and narrowband IoT. We will continue to expand IoT application scenarios into various industries and fields and further deepen the integration of the IoT with various industries so as to support the construction of Digital China and smart cities and make our information infrastructure more beneficial to the people and social development. Thank you.

Jin Zhuanglong:

Let me give an update on 6G development, which may be of interest to you. We have constantly reviewed the experience of 5G development and encouraged the industry to set up an IMT-2030 (6G) Promotion Group, which is expected to offer a platform for industry, research institutes and telecom operators to promote the integrated development of production, teaching, research and application, and boost international cooperation exchanges and technology development. Thank you.

People.com.cn:

We noted that since last year, the MIIT and other relevant departments have rolled out implementation plans for carbon dioxide peaking in the industrial sector and related key industries like non-ferrous metals and building materials. What is the focus of this year's relevant work? And what steps will be taken next to promote the green transformation of manufacturing? Thank you.

Jin Zhuanglong:

Thank you for your question, which has attracted much attention both at home and abroad. I would like to invite Mr. Xin to answer it.

Xin Guobin:

Let me answer your question. Green and low-carbon development is the big trend in global sustainable development. To accelerate green and low-carbon industrial development is an important measure in boosting a new type of industrialization for China. Since last year, the MIIT has fully implemented Xi Jinping Thought on Ecological Civilization and the decisions and plans of the CPC Central Committee and worked with related departments in rolling out the implementation plans of carbon dioxide peaking in the industrial sector and the key industries of steel, non-ferrous metals, petrochemicals, and building materials. This has helped preliminarily establish a policy framework system for promoting green industrial development. This year, the MIIT's efforts will focus on implementing these plans one by one. We will work hard in the following four aspects:

First, we will promote green manufacturing. We will research, formulate, and issue guidelines for accelerating green development in the manufacturing sector, provide specific guidance for different categories, and implement targeted policies for different industries. We will establish a dynamically upgraded green technology catalog and project library, accelerate the popularization and application of advanced technologies, and boost green upgrading and reconstruction in industries such as iron and steel, building materials, light industry, and textiles. The work in this area is crucial, as Mr. Jin mentioned earlier when answering the first question, traditional industries lay the foundation for our modern industrial system. Those key sectors are of great significance to promoting green and low-carbon development across the whole industry. We will also improve a graded cultivation mechanism; fully pursue green designs for industrial products; foster a batch of green factories, industrial parks, and supply chains; further develop green manufacturing service providers; and intensify efforts to revise relevant standards and regulations.

Second, we will launch a special campaign for industrial energy conservation and carbon reduction. We will deepen energy-saving supervision and diagnostic services. Our target for this year is to complete energy-saving supervisions for 3,000 industrial enterprises and energy-saving diagnoses for more than 1,000 specialized and sophisticated enterprises that produce new and unique products. We will promote high-quality development of the electric arc furnace steel-making process to drive the electrification of the industrial processes. We will establish public service platforms for reaching peak CO2 emissions and carbon neutrality goals; launch pilot projects, including industrial green microgrids and digital carbon-managing systems; and further create typical application scenarios to accelerate green, digitalized, and coordinated transformation. Meanwhile, we will also strengthen benchmarking for energy efficiency and intensify technological reconstruction in key industries to save energy and reduce carbon emissions.

Third, we will improve the quality and efficiency of comprehensive resource utilization. We will further enhance battery recycling and utilization systems for new energy vehicles, promote full traceability management, strengthen the standardized management of renewable resources such as scrap steel and waste paper, and cultivate over 100 key enterprises for comprehensive utilization. We aim to achieve a scrap iron and steel utilization of 265 million tons in 2023. We will work hard to make breakthroughs in utilizing complex and difficult-to-use industrial solid waste such as phosphogypsum and actively expand channels for its comprehensive utilization. Furthermore, we will also focus on steel, petrochemical, chemical, and other key water-intensive industries to carry out pilot projects for wastewater recycling.

Fourth, we will focus on cultivating new drivers of green growth. We will further strengthen the new energy vehicle industry, innovate and develop green aircraft, and promote electric, green, and intelligent upgrading of inland vessels. We will comprehensively enhance the supply capabilities of photovoltaics and lithium batteries, accelerate the building of a standardized industrial system, and promote the innovation and application of intelligent photovoltaics in industrial, construction, transportation, and communication sectors. At the same time, we will also vigorously develop the hydrogen energy and environmental protection equipment industries, as well as research and industrialization of new bio-based materials. Through these efforts, we will further achieve our green development goals for this year. That concludes my answer. Thank you.

Voice of China, China Media Group: 

We've noted that digital technologies like AI and big data have blossomed over recent years, and more and more intelligent factories, automated workshops, and smart manufacturing scenarios have mushroomed from place to place. My question is, what measures will the MIIT take to accelerate the development of smart manufacturing? 

Xin Guobin:

Thank you for your attention to smart manufacturing. Since the 18th CPC National Congress, China's smart manufacturing has been applied on a larger scale and developed rapidly. The achievements regarding smart manufacturing have propped up the high-quality development of the industrial economy. By now, China has built over 2,100 high-level digitalized workshops and intelligent factories, of which 209 are demonstration and benchmark cases. We conducted an analysis of the before and after effects of intelligent upgrading on these 209 enterprises and found that through their transformation, the R&D cycle has been shortened by 20.7%, the production efficiency improved by 34.8%, the defective products rate reduced by 27.4%, and the carbon emissions decreased by 21.2%. We also made a preliminary analysis and summary and concluded that the product iteration speed and delivery capabilities of equipment manufacturing and other discrete manufacturing had been greatly improved, while the safety and green development of process industries such as steel smelting and petrochemicals had been significantly enhanced. Therefore, intelligent transformation is of great significance to enterprises.

Currently, the integration of a new generation of information technology and advanced manufacturing technology has become characteristic of the new round of industrial transformation, propelling profound changes in global industrial and value chains. Developing intelligent manufacturing has become a common choice for major industrial countries to improve core competitiveness. We will continue to focus on intelligent manufacturing; promote technological transformation, improvement, and upgrading; and reshape industrial modes and enterprise forms of manufacturing through intelligent development. These are also decisions and deployments made by the CPC Central Committee and the State Council. This year, we will conduct the work in three aspects, as follows:

First, we will promote application at multiple levels. Targeting key industries, we will develop a batch of world-class intelligent factories and smart supply chains. For small and medium-sized enterprises, we will promote targeted solutions like technology improvement, lean management, and process reengineering on a large scale. For key provinces and cities, we will establish a number of intelligent manufacturing pilot zones and explore the formation of development paths and models with regional characteristics.

Second, we will accelerate breakthroughs in the innovation of integrated technologies. We will strive to make breakthroughs in manufacturing technologies like complex design and advanced techniques, mobilize personnel in all sectors, and give full play to the primary role of enterprises to realize fundamental and strategic breakthroughs. At the same time, we will conduct the R&D and promotion of applicable technologies like AI and Digital Twin and acquire original and forward-looking achievements. We will also promote the digitization of industrial knowledge and develop a batch of basic industrial software and core technology packages.

Third, we will strengthen fundamental support capacities. We will study and formulate policies and measures to promote the digital development of equipment and support the realization of Digital China through the innovation of intelligent equipment. We will enhance the construction of digital infrastructure and accelerate large-scale deployment and application of 5G, the industrial internet, and other technologies. Mr. Jin and Mr. Tian have explained the arrangement and deployment of this work, so I will not elaborate more. Afterward, we will improve the standard system of intelligent manufacturing, deepen applications of fundamental standards, actively participate in international communication and cooperation, learn from each other, and jointly improve intelligent development in various fields. Thank you.

The Beijing News: 

In recent years, China's digital economy has prospered and achieved remarkable accomplishments. The report to the 20th CPC National Congress made important deployments on accelerating the development of the digital economy and further integrating it with the real economy. What measures will the MIIT take to promote integration? Thank you!

Jin Zhuanglong:

Thank you for your question. The digital economy is of great concern to all of us, and the concept of digital economy is comprehensive and covers a wide range of areas. The current new round of scientific and technological revolution and industrial transformation is booming. Integrating the digital and real economies profoundly transforms economic forms, manufacturing methods and business organization models. I believe the full integration of IT applications with industrialization is the key area of integrated development of the digital and real economies. China's industrial economy is large, and the scale of its digital economy ranks second in the world, with broad prospects for integrated development. We will focus on the strategic goals of building up strength in manufacturing, cyberspace and digital technologies in China, targeting the innovation, breakthrough, and extended application of digital technologies, so as to boost the integrated development of IT applications and industrialization. In summary, this involves three main aspects: network platforms, digital industries, and integrated development.

First, we will solidly promote the construction of network infrastructure. China has built the world's largest, technologically advanced network infrastructure and the gigabit network access covers all prefecture-level cities. This year, we will further implement the gigabit city construction action. Recently, we held a gigabit city summit forum to guide local governments and the business circle to accelerate the construction with increased investments to further extend the coverage of 5G and gigabit optical fiber networks. We will also research and develop a computing infrastructure development action plan and strengthen the construction of industrial internet infrastructure.

Second, we will accelerate the development of core industries of digital economy. In 2022, China's electronic information manufacturing industry achieved an operating income of 15.4 trillion yuan, with software related income reaching 10.8 trillion yuan, laying a solid industrial and technological foundation for the integrated development of IT applications and industrialization. We will accelerate the development of artificial intelligence, big data, blockchain, cloud computing, cyberspace security and other emerging digital industries. We will also guide and support enterprises to increase investment in research and development and upgrade industries such as communication equipment, core electronic components, and ultra-high-definition displays. We will promote the high-quality development of the integrated circuit and industrial software industries. We will build high-standard software colleges with unique features and establish reputable software industrial parks in China.

Third, we will vigorously advance the digital transformation of the manufacturing industry. We will formulate a digital transformation roadmap for key industries and cultivate such enterprises that serve as models for others to follow regarding digital transformation. We will implement an action plan to boost 5G development, deepen the integrated application of 5G technologies and the industrial internet, promote the application of industrial internet in industrial parks, and create factories thoroughly equipped with 5G technologies. We will implement a smart manufacturing partnership program and take action to promote standardization in the area so as to build world leading smart factories and smart supply chains and develop new models and new business forms, such as service-oriented manufacturing. That's all for my answer. Thank you!

Shou Xiaoli:

Thank you, Mr. Jin. Thank you to all the speakers and friends from the media. This is the end of today's press conference. Goodbye, everyone.

Translated and edited by Zhu Bochen, Li Huiru, Wang Qian, Xu Xiaoxuan, Ma Yujia, He Shan, Qin Qi, Liu Caiyi, Liu Sitong, Mi Xingang, Huang Shan, Lin Liyao, Zhang Rui, Duan Yaying, Wang Yanfang, Yan Bin, Liu Qiang, Liu Jianing, Zhou Jing, David Ball, Tom Arnsten, and Jay Birbeck. In case of any discrepancy between the English and Chinese texts, the Chinese version is deemed to prevail.

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                                                                                                                                                              Read in Chinese

Speakers:

Mr. Liu Kun, minister of finance

Mr. Xu Hongcai, vice minister of finance

Mr. Zhu Zhongming, vice minister of finance

Chairperson:

Mr. Chen Wenjun, director general of the Press Bureau of the State Council Information Office (SCIO) and spokesperson of the SCIO

Date:

March 1, 2023

Chen Wenjun:

Ladies and gentlemen, good morning. Today, the State Council Information Office (SCIO) is holding the fifth press conference in the series "Embarking on the New Journey — A Government Perspective." We are honored to have invited Mr. Liu Kun, minister of finance, to brief you on how the Ministry of Finance (MOF) has implemented the major decisions of the 20th National Congress of the Communist Party of China (CPC), and take your questions. Also present at today's press conference are Mr. Xu Hongcai and Mr. Zhu Zhongming, both vice ministers of finance.

Now, I'll give the floor to Mr. Liu Kun for a brief introduction.

Liu Kun:

Ladies and gentlemen, friends, good morning. It's my great pleasure to meet with you face-to-face ahead of the "two sessions." First of all, on behalf of the MOF, I would like to thank friends from the media for your long-term interest in and support for public finance work. I'll take this opportunity to briefly introduce public finance work in 2022.

2022 was an extraordinarily significant year in the history of the CPC and our country. The 20th CPC National Congress was successfully convened, drawing up a grand blueprint for comprehensively building a modern socialist country. The CPC Central Committee with Comrade Xi Jinping at its core rallied and led the Chinese people in rising to challenges, steadily improving development quality, and ensuring overall economic and social stability. At a meeting held by the Political Bureau of the CPC Central Committee on April 29, 2022, General Secretary Xi Jinping emphasized that China should step up macroeconomic policy adjustment, take solid steps to keep economic performance stable, and strive to meet the economic and social development goals set for the whole year. Under the centralized, unified leadership of the CPC Central Committee, the MOF thoroughly implemented the guiding principles of the 20th CPC National Congress, adhered to the general principle of pursuing progress while ensuring stability, fully and faithfully applied the new development philosophy, accelerated efforts to foster a new development pattern, and implemented various fiscal policies early on for the steady recovery and growth of the economy. Revenue in the national general public budget reached 20.37 trillion yuan, an increase of 0.6% over 2021. Expenditure in the national general public budget reached 26.06 trillion yuan, an increase of 6.1%, providing necessary financial support for efficiently coordinating epidemic prevention and control with economic and social development.

First, we stepped up implementation of fiscal policies to maintain stable macroeconomic performance. We promoted the overall planning of financial resources, maintained a necessary level of spending intensity, and increased aggregate domestic demand while keeping a reasonable level of deficit ratio. We maintained the overall deficit ratio within 3% during the past five years to leave ample policy space for meeting new difficulties and challenges. We fully implemented tax and fee policies to support enterprises. Tax and fee reductions, tax refunds and cuts, and fee deferrals introduced last year totaled more than 4.2 trillion yuan, lowering the tax-to-GDP ratio in China from 17% in 2018 to 13.8% in 2022. We accelerated the issue and use of local government special-purpose bonds, and made good use of 502.9 billion yuan in the special bond spare quota in accordance with the law. We implemented robust and effective macro-fiscal control to help maintain stable macroeconomic performance.

Second, we strengthened funding and policy support for primary-level governments to maintain stable fiscal operations. In the past year, we prioritized fiscal operations at county and district levels, strengthened funding and policy support, and did our best to help primary-level governments maintain stable operation. In 2022, central government transfer payments to local governments reached 9.71 trillion yuan, representing a growth of 1.42 trillion yuan, or 17.1%. In the past five years, transfer payments to local governments totaled 40.66 trillion yuan, with an average annual growth rate of 8.4%, providing a strong support for guaranteeing the payment of salaries, normal operation of primary-level governments and the basic wellbeing of the people. We expanded direct allocation to prefecture- and county-level governments, with direct allocated funding increasing from 1.7 trillion yuan in 2020 to around 4.1 trillion yuan last year. On the whole, fiscal operations at county and district levels remained stable, laying a solid foundation for overall economic and social stability.

Third, we pursued innovation to promote the stability of industrial and supply chains. In 2022, national expenditure on science and technology hit 1,002.3 billion yuan, up 3.8% year on year, which guaranteed the capital needed for basic research and making breakthroughs in key and core technologies. Meanwhile, we optimized our policies. We raised the R&D expenses related additional tax deduction rate to 100% for small and medium-sized scientific and technological enterprises. We improved government procurement policies to support innovation. We implemented policies to provide temporary fiscal subsidies for domestic passenger flights. We supported a portion of national comprehensive freight hubs to shore up logistic chains in a bid to increase the tenacity of industrial and supply chains. 

Fourth, we advanced rural revitalization and strengthened the balanced and coordinated development between urban and rural areas and between different regions. Following the new development philosophy, we leveraged the roles of transfer payments and fiscal and tax policies to advance the coordinated development between urban and rural areas and between regions. We provided 40 billion yuan in subsidies for grain planters in three batches and allocated 10 billion yuan from central reserve funds to support drought relief, disaster mitigation, and ensuring autumn harvest. The central government increased the scale of subsidies for rural revitalization. We pushed forward the implementation of major regional strategies and the strategy for coordinated development between regions, increasing transfer payments to old revolutionary base areas, areas with large ethnic minority populations, border areas, and poor areas by 8.2%. 

Fifth, we met basic needs and helped those most in need to improve people's well-being. Upholding a people-centered development philosophy, we met people's needs as much as possible to ensure that public services are inclusive, meet essential needs, and ensure basic living standards for people in difficulty. We ensured expenditure on epidemic prevention and control to reduce the impact on production and daily life. We guaranteed key spending in ensuring people's well-being. The national capital invested in education, social security and employment, public health, as well as addressing air, water and soil pollution and improving rural environment increased by 5.5%, 8.1%, 17.8% and 13.8%, respectively. People's lives have continued to be improved. Since 2017, the national average subsistence allowance standards in urban and rural areas have grown by 39.2% and 62.4%, respectively. The per capita government subsidies for basic health insurance for rural and non-working urban residents increased from 450 yuan to 610 yuan.

Sixth, we deepened the reform of the fiscal and tax system and enhanced the quality and efficiency of governing and supervising finance. The oversight of finance and accounting is an important part of the Party and state oversight system. In our efforts to advance fiscal and tax reforms, we issued guidelines on advancing fiscal system reform at the sub-provincial level and stepped up with integrated budget management. We fulfilled our primary responsibilities in the oversight of finance and accounting and improved the supervision system for fiscal work, focusing on key points in supervision and emphasizing financial disciplines. In doing so, the ability to govern finance was steadily improved.

Ladies and gentlemen, friends from the media, the year 2023 marks the first year of fully implementing the guiding principles of the 20th CPC National Congress. The MOF will take studying and implementing the guiding principles of the 20th CPC National Congress as a primary political task at present and in the coming years. We should acquire a deep understanding of the decisive significance of the establishment of both Comrade Xi Jinping's core position on the Party Central Committee and in the Party as a whole and the guiding role of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, and boost our consciousness of the need to maintain political integrity, think in big-picture terms, follow the leadership core, and keep in alignment with the central Party leadership. We should stay confident in the path, the theory, the system, and the culture of socialism with Chinese characteristics. We should firmly uphold Comrade Xi Jinping's core position on the Party Central Committee and in the Party as a whole and uphold the Central Committee's authority and its centralized, unified leadership. We will prevent and control the COVID-19 pandemic and pursue economic and social development in a well-coordinated way, improve the quality of the economy while maintaining a moderate growth rate of GDP, and balance supply-side structural reform and expanding domestic demand. We will align economic policies with other policies and the domestic economic cycle with the international economic cycle and coordinate current and long-term development. Positive fiscal policies with expanded coverage and enhanced efficiency will facilitate the overall improvement of national economic performance to provide strong support for getting this endeavor to build China into a modern socialist country in all respects off to a good start. 

That's all for my introduction. Thank you. 

Chen Wenjun:

Thank you, Mr. Liu. Now the floor is open for questions. Please identify yourself before asking questions.

CCTV:

Recently, the United Nations and multiple other institutions have raised China's economic growth forecast for 2023, believing that China has sufficient fiscal space to support stable economic growth. The Central Economic Work Conference also noted that, in 2023, the proactive fiscal policy should be stepped up with greater intensity and effectiveness to boost market expectations. In what areas will China increase its proactive fiscal policy with greater intensity this year? How can the policy's effectiveness be further improved? Thank you.

Liu Kun:

Thank you for your questions. The Central Economic Work Conference held at the end of last year put forward specific requirements for the direction and arrangement of fiscal policy. General Secretary Xi Jinping pointed out that we need to prioritize economic stability and pursue steady progress while ensuring economic stability. We also need to continue implementing the proactive fiscal policy and prudent monetary policy and see that the proactive fiscal policy is stepped up with greater intensity and effectiveness.

Enhancing the intensity and effectiveness of the proactive fiscal policy reflects the general principle of pursuing progress while ensuring stability. The move also pays equal attention to actual and possible needs, present and long-term situations, development, and security. The foundation of domestic economic recovery is not yet solid and the triple pressures of shrinking demand, disrupted supply and weakening expectations are still mounting. Moreover, the external environment is in turmoil. These risks and challenges require us to strengthen macro-regulation through fiscal policy and employ a combination of policy tools to maintain fiscal sustainability and ensure that local government debt is kept under control as we effectively support high-quality development.

Regarding policy intensity, we will work to moderately expand fiscal policies in the following three aspects. First, we will intensify our efforts on fiscal spending. Expenditure on the national general public budget reached 22.06 trillion yuan in 2022. Based on this, we will coordinate policy tools involving fiscal revenue, fiscal deficit, and loan interest subsidies while appropriately expanding fiscal spending. Second, we will intensify efforts to boost investment in special-purpose bonds. We will budge the scale of special-purpose bonds issued by local governments in a reasonable manner. We will also moderately expand both investment areas and the scope of special bonds that can be used as project capital to continuously boost investment. Third, we will intensify efforts to channel fiscal funds to local levels of government. We will keep increasing central government transfer payments to local governments and direct spending toward poor and underdeveloped areas to ensure livelihoods, salaries and operations at the primary level.

We also need to improve the effectiveness of policies. We will work to improve preferential tax and fee policies, make sure they are more targeted, and strive to ease the difficulties facing businesses. We will also optimize the structure of fiscal spending and give full play to the leveraging role of government funds in expanding investment and boosting consumption. Meanwhile, we will strengthen coordination between monetary, industrial, technological and social policies and create a synergistic effect for an overall economic upturn.

Enhancing the intensity and effectiveness of the proactive fiscal policy covers many issues. Here, I would like to emphasize the following five aspects.

First, we will improve supportive tax-and-fee policies and ease businesses' difficulties. Considering both the need to help businesses and the fiscal affordability, we will further improve preferential tax-and-fee policies and prioritize the support for micro-, small- and medium-sized enterprises (MSMEs), self-employed individuals, and sectors in serious trouble, to further lower the corporate burden and generate strong growth momentum.

Second, we will strengthen coordination on fiscal resources and maintain the necessary level of spending intensity. We will pool resources to complete key national undertakings and optimize the combination of policy tools. We will scale up investment in sectors that help reinforce the foundation for the country's long-term development, strengthen areas of weakness, and optimize the development structure, in a bid to ensure funding support for the nation's key strategic tasks.

Third, we will ramp up efforts to improve the mix of spending and continue increasing efficiency in this regard. Party and government bodies will keep their belts tightened, avoid spending money on unnecessary matters, and keep spending low to benefit the people. We will proactively support key fields involving sci-tech breakthroughs, rural revitalization, education and green development. We will also improve the mechanism to directly allocate budgetary funds to prefecture- and county-level governments and see that fiscal funds are used efficiently following relevant regulations.

Fourth, we will balance the fiscal capacity among different regions and equalize their access to basic public services. We will keep increasing central government transfer payments to local governments and improve their ability to provide fiscal support. We will reform the fiscal systems below the provincial level and improve the mechanism to ensure long-term funding for county-level governments. We will promote the development of a system of standards for ensuring basic public services.

Fifth, we will tighten financial discipline and effectively guard against fiscal risks. We will strictly regulate fiscal revenue and expenditure management and improve oversight and monitoring mechanisms to tighten financial discipline. We will resolutely deter borrowing in violation of laws and regulations, curb the growth of hidden debts, prudently address existing ones, and ensure no systemic risks arise. Thank you.

Reuters:

Some local governments face a tight fiscal balance due to less revenue from land sales, anti-COVID spending, infrastructure expenditure, and pressure from maturing debts in large volumes. How does the MOF view this situation?

Liu Kun:

Your question includes many small ones. Thank you very much for your questions. First, I would like to brief you on the revenue and expenditure of local governments last year. In 2022, revenue in local governments' general public budget was 10.88 trillion yuan, an increase of 5.9% after deducting value-added tax (VAT) credit refunds. Expenditure in local governments' general public budget was 22.5 trillion yuan, an increase of 6.4% over the previous year. The fiscal performance of local governments was generally stable. With the improvement and adjustment of epidemic prevention and control policies, and the continuous effects of the package of policies and follow-up measures to stabilize the economy, the economy is expected to pick up, in general, this year, and the fiscal performance of local governments is expected to improve gradually.

Your question contains three small questions, which I would like to answer one by one.

Regarding revenue from land sales, a large part of the budgets of local government-managed funds come from land sale revenue. Looking at the budgets of local government-managed funds across the country, some revenue was transferred to the general public budget, accounting for about 15% of the budgets of local government-managed funds. Although there was a decline last year, the effect on expenditure in local governments' general public budget was controllable. The specific data is yet to be determined in the final accounts. However, suppose we estimate based on a decrease of about 2 trillion yuan in revenue from land sales in 2022. In that case, the affected financial capacity in local governments' general public budget will be about 300 billion yuan. I would also like to point out that revenue from land sales is gross revenue. When revenue decreases, there will also be a corresponding reduction in cost outlay, such as compensation for demolition and relocation. Since revenue and expenditure are interconnected, the revenue decline has no significant influence.

You also mentioned pressure from maturing debts in large volumes. Regarding debts, the liability ratio of statutory debt last year was about 50%, a relatively low level by global standards and in the economic world. The main problem regarding the debts of China's local governments is that they are distributed unevenly, with some regions facing higher debt risks and pressure to pay principal and interests. We have urged local governments to assume their primary responsibility for defusing local government debt risks to ensure no systemic risks arise. That's a bottom line we can hold to.

You also asked about the fiscal balance of local governments. Revenue in local governments' general public budgets grew by an average of 2.5% from 2020 to 2022, compared with a 2.1% decline last year. You also said it was falling and in a state of borderline sufficiency. It fell by 2.1% last year, many percentage points lower than the ten-year average. But you have to know that the financial capacity of local governments is not the same as local-level revenue in their general public budget. About 40% of local governments' financial capacity comes from transfer payments from the central government. In the past three years, transfer payments from the central government have grown at an average annual rate of 9.3%. I mentioned at the very beginning the average growth rate over the past five years, and here is that over the past three years. You can see that our transfer payments to local governments are growing. The 9.3% growth rate was 6.8 percentage points higher than the growth rate of revenue in local governments' general public budgets, effectively making up for the shortfall in local-level revenue. In terms of the execution of local budgets, local government expenditures have increased by an average of 3.4% in the past three years. Therefore, it is a state characterized by borderline sufficiency but an increasing aggregate. Local budgets are well executed. Thank you for your question.

21st Century Business Herald:

Government funds always play a leveraging role in effectively propelling the expansion of total investment. With special-purpose bonds being an important channel, will local governments issue more this year? In what fields will the bonds be mainly invested? You've just mentioned the funds should be used as soon as possible so that they can take effect early.

Liu Kun: 

Now let's give the floor to Vice Minister Xu Hongcai.

Xu Hongcai:

Issuing special-purpose bonds for local governments is essential for driving and expanding effective investment and maintaining macroeconomic stability. Since 2018, newly added special-purpose bonds for local governments have totaled 14.6 trillion yuan. Among them, newly added bonds in 2022 totaled 4 trillion yuan, including those enlisted in government budgets and allocated from unused quotas before in accordance with law, used to support the construction of 30,000 key projects. These projects helped strengthen the economic foundation, enhance areas of weakness, improve people's lives, expand investment, and propel social and economic development.

This year, we will step up proactive fiscal policies. According to the Central Conference on Economic Work, tools like deficits, special-purpose bonds, and interest subsidies should be better combined to guarantee the sustainability of government funds and control local government bond risks while supporting high-quality development. We will follow and implement the principles of the Central Conference on Economic Work, ensuring that the size of special-purpose bonds is kept within an appropriate range. We will ensure government investment does not diminish and that it better plays its leveraging role. The specific amount will be released during the annual session of the National People's Congress.

As for the question of the investment orientation and fields, this year, we will mainly support the construction of projects in the 11 fields set before. On this basis, we will expand the investment fields and the range of funds used as project capital appropriately. We will step up the construction of key projects continuously, make solid achievements, and form the driving force of investment to support high-quality development effectively. These tasks will be further deployed and arranged later. Thank you.

China Securities Journal: 

The MOF recently issued a bulletin on accounting quality inspection. According to it, over 170 accounting firms were punished. We see that the supervision of auditing firms has become stricter and the redline of financial discipline has become more apparent. My question is, what will the MOF do to enforce financial discipline this year? Thank you.

Zhu Zhongming:

Thank you for your attention to financial and accounting supervision. The CPC Central Committee and the State Council attach great importance to this work and General Secretary Xi Jinping has made important instructions on tightening financial discipline and enhancing financial and accounting supervision on different occasions. The MOF has followed and implemented the guiding principles of the important instructions, fulfilled the primary responsibility of financial and accounting oversight, tightened up financial discipline and played an important role in exercising full and rigorous Party self-governance, ensuring financial order, and promoting high-quality social and economic development. 

Recently, the central authorities released a document on enhancing financial and accounting supervision, which stipulated the main aspects of the work, such as establishing a supervision system, developing sound mechanisms, and so on. It is significant in advancing the work in the new era and enforcing financial discipline. The MOF will follow and implement the document, focus on the main responsibility of supervision, clarify incentive and constraint mechanisms, have zero tolerance towards violations of laws and rules and never let financial discipline exist in name only.

In 2023, we will conduct special campaigns on financial and accounting supervision and make efforts in the following three key areas: 

First, we will ensure the implementation of major decisions and deployments made by the CPC Central Committee and the State Council. We will prioritize this on the agenda of financial and accounting supervision work. We will strictly investigate and handle financial infractions that violate the central government's macro decisions, governance, and regulatory requirements and impact the high-quality development of the economy and society. We will ensure that the central government's policies and decisions are implemented smoothly. 

Second, we will adopt more stringent financial discipline and restrictions. We will focus on implementing tax-and-fee policies , tightening the belts of the Party and government institutions, and stepping up efforts to ensure payment of salaries, normal operations, and the basic well-being of the people at the community level. We will also enhance restrictions and supervision and tighten financial discipline.

Third, we will crack down hard on financial and accounting violations. We will adhere to the principles of adopting powerful measures, closing loopholes, imposing severe punishments and promoting integrity. We will strengthen supervision of the quality of accounting information and intermediary institutions' performance, strictly investigate and handle violations such as financial fraud and accounting deceit, resolutely eliminating the "black sheep." 

You mentioned that the MOF punished more than 170 accounting firms last year, which is more than the total of the previous three years. This year, we will intensify our efforts in this regard. In addition to the MOF's direct inspection of 35 accounting firms and 10 asset evaluation agencies, we will organize financial departments nationwide to conduct inspections with broad coverage. We will rigorously handle and punish any breaches uncovered during inspections in accordance with laws, promptly publish inspection announcements and typical cases, and strengthen financial discipline, making it an untouchable "high-voltage wire." Thank you.

The Paper:

Mr. Liu noted that China cut 4.2 trillion yuan in taxes and fees last year, hitting a record high. How will the preferential policy of tax and fee reductions continue and be improved this year? Thank you. 

Liu Kun:

I will invite Mr. Zhu to answer this question about tax and fee reductions. 

Zhu Zhongming:

Thanks for your question. In 2022, facing the triple pressures of shrinking demand, disrupted supply and weakening expectations, the CPC Central Committee with Comrade Xi Jinping at its core exercised overall leadership, made sound decisions, improved and innovated macro regulation, promptly and decisively implemented a new package of tax-and-fee policies, which helped cultivate and develop business entities, and promote economic recovery. 

The tax and fee reduction policies implemented last year had the following three features:

The first was intensive efforts. Tax and fee reductions, as well as tax refunds and postponed tax and fee payments introduced last year, totaled more than 4.2 trillion yuan, including approximately 2.46 trillion yuan in value-added tax (VAT) credit refunds, which is 3.8 times more than that of 2021. This was the most substantial effort in recent years. 

The second was early implementation. Efforts were made to refund substantial VAT credits at a bigger scope and faster pace, with most completed in the first half of last year. The outstanding VAT credits for the year were refunded in advance by the second quarter. Various preferential policies were implemented early for quick effect.

The third was more coordination. We strengthened coordination and connection and successively introduced a package of policies, including granting small taxpayers exemptions from VAT payments, temporary postponement of social insurance premium payment, and purchase tax reductions on certain passenger vehicles. These policies were designed to ease difficulties and promote synergies.

Tax cuts and fee reductions get right to the spot in tackling the pains and difficulties currently troubling business entities and apply a "fertilizer" to the roots of their development. The effect of easing the burdens and difficulties is quite obvious. We compiled statistics and found that in 2022, the tax burden of 100,000 key tax source enterprises across the country dropped by 2.7% per 100 yuan revenues. As Mr. Liu Kun just reported, the proportion of China's tax revenue in GDP dropped to 13.8% last year. After excluding the one-time factor of large-scale VAT credit refunds, the tax burden level was about 15%. This has increased cash flow and enhanced development vitality for enterprises, making them more resilient in responding to risks and challenges.

In 2023, various tax-and-fee policies will still play a significant role in helping enterprises ease their difficulties and maintaining major economic indicators within an appropriate range. We will take into account the bearing capacity of finance and the need to ease the difficulties of businesses, study and clarify policies as soon as possible, ensure they are implemented, and promote the formation of a positive circle of "building a deeper pool to farm more fish."

First, we will fully implement all existing policies. We will continue to implement the tax cut and fee reduction policies that have been clearly outlined. We will take solid steps to ensure that tax and fee reductions take full effect. At the same time, we will act firmly against tax evasion and tax fraud, and resolutely deter arbitrary charges.

Second, we will refine and improve our preferential policies. In terms of existing measures such as tax cuts, fee reductions, tax refunds, and tax deferrals, we will focus on continuing and optimizing these measures so that these policies can better benefit business entities.

Third, we will further enhance the precision of our policies. We will focus on support for MSMEs, self-employed individuals, and industries in extreme difficulty and create momentum and vitality for micro-entities' development. Thank you.

Kyodo News:

From a macroeconomic point of view, General Secretary Xi Jinping places great importance on expanding domestic demand. Which policies are particularly critical in achieving this goal? For instance, purchase subsidies for new-energy vehicles have been terminated. From what aspects will the MOF use fiscal policy resources to drive the expansion of consumption? Thank you.

Xu Hongcai:

You raised a very important question because consumption is a key engine of economic growth and the ultimate aim of people's work and lives. The report to the 20th CPC National Congress pointed out that the fundamental role of consumption in stimulating economic growth should be leveraged. Clear requirements were put forth at the Central Economic Work Conference for prioritizing consumption recovery and expansion. A few years back, the contribution of final consumption to China's economic growth was more than 60%. However, the consumption growth rate has declined due to factors such as the epidemic in recent years. This is also an important reason for slower economic growth.

Promoting consumption is crucial for driving economic growth and ensuring sustained and healthy economic development. Restoring consumption as soon as possible is the main driving force of economic growth. The key to vigorously improving consumer confidence and unleashing consumption potential is to address acute issues such as limited spending power, inconvenient consumption, and reluctance to spend. Financial departments will fully implement the strategy of expanding domestic demand and actively improve policies and measures centered on better exploiting the fundamental role of consumption. We will start from the following three aspects to stimulate consumption potential to further support and promote the recovery and upgrading of the consumer market.

First, we will strive to increase personal income through various channels to ensure ordinary people have more money to spend. We should do everything possible to increase employment, enabling people to create income through hard work. We will expand social security, transfer payments, and other adjustments to improve the consumption capacity of medium- and low-income residents while improving tax and fee preferential policies to stimulate social consumption potential.

Second, we will support efforts to increase the supply of readily marketable products to enhance people's willingness to consume. By adopting proactive fiscal policies and advancing supply-side structural reform, we will continue to improve domestic supply quality to unleash market demand's potential. We will encourage localities with the right conditions to support, through current financial channels, the replacement of old home appliances as well as the purchase of green and smart home appliances in rural areas. We will continue to waive vehicle purchase tax for new-energy vehicles purchased in 2023 and lower import tariffs for some quality consumer goods. We will speed up establishing a housing system with multiple types of suppliers, multiple channels for housing support, and encouragement for renting and buying. We will also support people in buying their first homes or improving their housing situation. With all these efforts, we will actively expand consumer spending.

Third, we will ensure smooth sales channels and logistics services to make people's consumption convenient. We will facilitate action to develop county-level commerce to upgrade and expand consumption at the county level. Support will be given to develop the supply chain system for agricultural products and expand the consumer market for agricultural products. We will support the construction of a batch of national integrated freight transport hubs to reduce costs and improve efficiency in logistics. Thank you.

China News Service:

Fiscal revenue and expenditure this year have attracted wide attention. Can you provide a brief analysis? How will funding for key areas, such as ensuring people's livelihoods, be affected this year? Thank you.

Liu Kun:

You raised a question of public concern. To speak on fiscal revenue and expenditure this year, considering all factors, I believe that we can expect the economy's overall recovery this year, and fiscal revenue is mainly affected by two factors. One is that the recovery of the economy will lead to an increase in fiscal revenue. The other is that because we launched VAT credits refunds on a large-scale last year, the base is relatively low correspondingly. The joint influence of these two factors will lay a foundation for a rebound in fiscal revenue. However, we must also note that the foundation for achieving China's economic recovery needs to be further consolidated, and fiscal revenue faces major uncertainties. In terms of fiscal expenditure, expenditures in key areas, including research and development in science and technology, rural revitalization, and eco-environmental protection, will increase undoubtedly. Greater support is needed to shore up weak links in elderly care, education, healthcare and other areas that are important to people's lives. Government spending is directed to support the coordinated development of regions and support local governments in their efforts to ensure payment of salaries, normal operations, and people's basic well-being; sufficient funding is required to provide transfer payments.

Although notable budgetary imbalances still exist in 2023, we will not cut our spending on basic living needs. We will do everything within our capacity to ensure continued increases in spending to meet basic living needs, make every effort to bring tangible benefits to the people, and ensure a more complete and lasting sense of fulfillment, happiness, and security for our people.

First, we will fully implement the employment-first strategy. We will make full use of the central government's employment subsidies to support reducing burdens, stabilizing jobs and increasing employment. We will facilitate the employment of young people, especially college graduates. We will support rural migrant workers, people lifted out of poverty, ex-service members and other key groups in finding jobs and starting businesses. We will continue to support vocational skills training to tackle structural unemployment.

Second, we will give priority to ensuring the development of education. Based on the 21 trillion yuan of government spending on education in the past five years, we have continued to improve the mechanism for government spending on education. For many years, government spending on education has remained above 4% of GDP. Just now, I mentioned that the share of tax revenue in GDP has decreased. Tax revenue is a major source of fiscal revenue. The share of fiscal revenue in GDP has been decreasing. Meanwhile, the share of spending on education in GDP should be kept basically stable. Therefore, that means the share of government spending on education in fiscal expenditure has increased over the past few years. We will enhance weak links in compulsory education, increase resources for public-interest preschool education via multiple channels, and support the improvement of regular high schools' basic conditions.

Third, we will enhance medical and health services. We will support the COVID-19 response in a new phase and improve the funding mechanism for basic medical insurance. We will deepen the reform of public hospitals to ensure that they genuinely serve the public interest and advance the unified management of basic medical insurance funds at the provincial level.

Fourth, we will improve social security. We will fully implement unified national management of basic old-age insurance funds for enterprise employees and take active steps to promote the development of private pensions. We will improve supporting measures to boost birth rates as well as fiscal policies and measures in response to the aging population. We will support people in buying their first homes and improving their housing situation. I remember that at a press conference held here before, a reporter asked about efforts to guarantee basic old-age insurance for enterprise employees. My answer was that all enterprise employees in China would be ensured of the insurance. Now, basic old-age insurance funds are guaranteed in the way that I mentioned then.

Fifth, we will continue to improve the ecological environment. We will speed up the efforts to launch projects for the holistic conservation and restoration of mountains, waters, forests, farmlands, grasslands, and deserts. We will support the actions to keep our skies blue, waters clear, and lands clean and facilitate the transition of major industries and sectors towards green and low-carbon development. Thank you.

Chen Wenjun:

The last question.

Xinhua News Agency:

Tightening the government's belt is both a solution in response to contemporary developments and a strategy with a far-reaching impact. How will the central government implement the requirement for Party and government organs to keep tightening their belts?

Liu Kun:

It is a very good question. In recent years, finance departments at all levels have implemented the guiding principle of hard work, plain living, and thrift in fiscal work. The effectiveness of fiscal funding has been enhanced to help the Party and government organs live on a tight budget. Take the central government, for instance. Central government departments have exercised strict management over departmental spending, cutting general expenditures for four consecutive years. In 2022, the budgetary spending of central government departments was planned to decrease by 2.1%, while the actual decrease reached 3.5% in budget execution. We have spent money where it can be used most efficiently to better ensure funding for key areas.

General Secretary Xi Jinping once pointed out that hard work, plain living, and thrift are important for continuing our journey to grow in strength and building on past success for new historic achievements. The remarks remind us that tightening the government's belt is a policy we must uphold as a long-term rather than a short-term measure. We should cut expenditures to reorient fiscal resources toward supporting local governments in their efforts to guarantee people's basic living needs and the interests of market players. The government should tighten its belt to let people live better lives. 

During the execution of the budget, an increase in government administrative charges and spending on official overseas visits, official vehicles and official hospitality will lead to a decrease in spending to meet basic living needs. Likewise, transfer payments to local governments may decline when central government expenditures rise. In this regard, we have stepped up efforts and balanced expenditure and revenue nationwide over the three years of the fight against COVID-19. We have spent money where it can be used efficiently and effectively and generally achieved good results. A decline in local revenues hasn't impacted national financial security.

Remaining committed to the instructions of General Secretary Xi Jinping, the MOF will continue to fully implement the requirement of living on a tight budget. We will be as "tight-fisted" and "calculating" as possible, and see that every cent is used where needed most.

First, tighten the budget. Second, strengthen budget execution. Third, make effective use of available fiscal funds. Fourth, carry out regular assessments.

Specifically, we will draw up a tighter budget, cut or cancel inefficient or ineffectual expenditures, and pool resources to ensure funding for tasks involving major national strategies.

We will tighten constraints on budgetary spending and keep additional items in budgets under strict control for which funds may be appropriated. In principle, we will not introduce new policies that increase spending, except for expenditures on emergency response and disaster relief items. Overspending and spending beyond the set standard are forbidden.

We will timely review and recall surplus funds to avoid funds sitting idle for a long period of time. The budget for projects with large carryover funds will be reduced.

We will conduct quarterly assessments of central government departments to evaluate their implementation of living on a tight budget and strengthen the application of assessment results. We will also urge local governments to actively advance the development of an assessment system in this regard to cut administrative costs. Thank you.

Chen Wenjun:

Thank you to Mr. Liu and all the other speakers. Thank you to all my friends in the media. Today's press conference concludes here. Goodbye.

Translated and edited by Zhang Liying, Wang Qian, Liu Jianing, Liu Sitong, Zhu Bochen, Zhang Junmian, Zhang Jiaqi, Wang Yanfang, Mi Xingang, Yuan Fang, Xu Xiaoxuan, Li Huiru, Yan Bin, Huang Shan, Xu Kailin, Ma Yujia, Li Xiao, David Ball, Tom Arnsten, and Jay Birbeck. In case of any discrepancy between the English and Chinese texts, the Chinese version is deemed to prevail.

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Read in Chinese

Speakers:

Mr. Wang Zhigang, minister of science and technology 

Mr. Wu Zhaohui, vice minister of science and technology 

Mr. Zhang Guangjun, vice minister of science and technology 

Mr. Xie Min, director general of the Department of Policy, Regulation and Innovation System of the Ministry of Science and Technology (MOST)

Mr. Chen Jiachang, director general of the Department of High and New Technology of the MOST

Chairperson:

Mr. Chen Wenjun, director general of the Press Bureau of the State Council Information Office (SCIO) and spokesperson of the SCIO

Date:

Feb. 24, 2023

Chen Wenjun:

Ladies and gentlemen, good morning. Today, the State Council Information Office (SCIO) is holding the fourth press conference in the series "Embarking on the New Journey — A Government Perspective." We have invited Mr. Wang Zhigang, minister of science and technology, to brief you on implementing the innovation-driven development strategy to build China into a leading country in science and technology. We also have with us two vice ministers and two directors general of science and technology: Mr. Wu Zhaohui, vice minister; Mr. Zhang Guangjun, vice minister; Mr. Xie Min, director general of the Department of Policy, Regulation and Innovation System of the Ministry of Science and Technology (MOST); and Mr. Chen Jiachang, director general of the Department of High and New Technology of the MOST.

Now, let's give the floor to Mr. Wang for his introduction.

Wang Zhigang:

Hello ladies and gentlemen, friends from the media. First of all, I would like to thank all friends from the media for your long-term attention, care, support and help regarding scientific and technological innovation. I'm also very pleased to meet you ahead of the upcoming national two sessions and to brief you on the new measures and progress of the national science and technology community in studying and implementing the guiding principles of the 20th CPC National Congress, and speeding up efforts to achieve self-reliance and strength in science and technology .

Since the 18th CPC National Congress, the CPC Central Committee with Comrade Xi Jinping at its core has put sci-tech innovation at the center of the country's overall development and pushed for historic achievements and changes in China's sci-tech cause. From independent innovation to self-reliance and self-strengthening, from following others and participating to leading and pioneering, and from breakthroughs in key fields to systematic capacity improvement, the past decade has witnessed leapfrog development of China's sci-tech cause, the fastest improvement in China's sci-tech innovation ability, and the most prominent role played by science and technology as a primary productive force. China's ranking in the Global Innovation Index rose from 34th in 2012 to 11th in 2022, joining the ranks of the world's innovators and ushering in a new stage of building self-reliance and strength in science and technology and building China into a leading country in science and technology. The report to the 20th CPC National Congress states that innovation will remain at the heart of China's modernization drive and that education, science, technology and human resources are the foundational and strategic pillars for building a modern socialist country in all respects . A special chapter has been assigned in the report for relevant arrangements. This is a major strategic decision made by the CPC Central Committee with Comrade Xi Jinping at its core with a look toward the overall trend, the current situation and the long run.

The nationwide science and technology community has thoroughly studied and implemented the guiding principles, decisions and arrangements of the 20th CPC National Congress, overcome difficulties and worked hard. All sectors have worked together to tackle problems, and the country's eastern, central and western regions have cooperated to innovate. Integrated development has been secured within science and technology, industries and financing, and coordinated progress has been made in deepening reform and innovative development. All these have formed a mighty force in the whole nation to pioneer innovation with one heart and one mind. The position of sci-tech innovation in the overall cause of the Party and the country has never been given such prominence and it has played an unprecedented role. Empowerment through science and technology has become a prominent symbol of high-quality development and sci-tech innovation has become an important engine for the modernization drive.

China's sci-tech strength has markedly improved and its influence in the global innovation landscape has significantly increased. China's research and development (R&D) spending nationwide increased from 1 trillion yuan in 2012 to 3.09 trillion yuan in 2022, with R&D spending intensity rising from 1.91% to 2.55%. Investment in basic research rose from 49.9 billion yuan in 2012 to around 195.1 billion yuan in 2022, accounting for 6.3% of the country's total R&D spending, up from 4.8%. The total number of R&D personnel increased from 3.25 million person-years in 2012 to an estimated more than 6 million person-years in 2022, maintaining the first place globally for many years. China's academic papers accounted for 41.7% of the world's hot papers that perform in the top 0.1% of all papers based on citations, and accounted for 27.3% of highly cited papers. China is not only an important participant in international frontier innovation, but also a significant contributor to solving global problems.

Empowerment though science and technology across the board has provided more high-level groundwork for high-quality development. We have insisted that goal orientation and free exploration must go together, made a number of original achievements with international influence in basic research fields such as quantum information and brain science, and played a leading role in innovation in several important areas. We have paid equal attention to shoring up weak links and consolidating strengths, and made breakthroughs in core technologies of key industries including high-performance equipment, intelligent robots and laser manufacturing. We have actively invested in new areas and accelerated scenario application of emerging technologies like artificial intelligence, big data, blockchain and 5G. We have focused on the two key issues of seeds and arable land to strongly support and guarantee national food security. Regarding people's health and safety, sci-tech innovation has provided more precise and comprehensive support for disease prevention and control, public health and response to population aging. Sci-tech innovation has played a prominent role in penetrating, spreading and transforming. It has deeply integrated with every aspect of economic and social development and the lives of the people, greatly improved the quality and enduring driving force of China's development, and created a broader new vision and brought new, better expectations for the Chinese path to modernization.

Critical reform tasks have been conducted and overall effectiveness of the national innovation system has been significantly improved. The implementation of the three-year plan for structural scientific and technological reform has been accelerated and various breakthroughs have been made in key areas. We have boosted China's strength in strategic science and technology , and accelerated the establishment of a system of national laboratories with Chinese characteristics. High-level research universities and research institutes have played a key role in carrying out major national sci-tech tasks. The principal role of enterprises in sci-tech innovation has been further enhanced. High-tech enterprises increased from 39,000 in 2012 to 400,000 in 2022, contributing 68% of total R&D input of enterprises nationwide, and 762 are among the world's top 2,500 in terms of R&D input. We have coordinated the development of international and regional centers for sci-tech innovation. Zhongguancun has led a new round of trials in granting additional deductions for basic R&D costs and paying for sci-tech advances after trials. A total of 23 national innovation demonstration zones and 177 national high-tech zones have become the pacesetters in promoting high-quality development. Legal policies and cultural environment conducive to sci-tech innovation have been further improved, and the whole of society is more enthusiastic about supporting, investing in, participating in and facilitating innovation than ever before.

We have expanded opening-up and cooperation and actively fostered an innovation ecosystem conducive to international sci-tech exchanges and collaboration. Openness and cooperation are not only essential to the development of science and technology, but also necessary to meet global challenges. Following the international sci-tech cooperation philosophy of openness, inclusiveness, mutual benefit and shared benefits, we have collaborated scientifically and technologically with over 160 countries and regions, and participated in over 200 international organizations and multilateral institutions. China has carried out extensive international cooperative research in such key areas as climate change, clean energy and COVID-19 prevention and control, and conducted joint funding with more than 60 countries, regions and international organizations. The Belt and Road Science, Technology and Innovation Action Plan has yielded good results, and a number of joint laboratories have been built. China has made efforts to lead and organize major international science programs and projects, and actively participated in major international science projects such as the International Thermonuclear Experimental Reactor and the Square Kilometre Array . We have built more platforms for international sci-tech exchanges and cooperation in key areas to provide a broad stage for international talent to work in China and make China a fertile ground for global innovation and entrepreneurship.

In 2022, thanks to the joint efforts of the whole scientific and technological community, we scored one success after another in scientific and technological innovation. The Tianhe, Wentian, and Mengtian modules have been sent to space as part of China's orbital space station. The Kuafu-1 solar probe, the Qinghai-Tibet scientific expedition, micro-nano satellites, quantum communication, and proton therapy also emerged as key breakthroughs. For the first time, society's spending on research and development exceeded 3 trillion yuan. In addition, the research and development investment intensity exceeded 2.5% for the first time. The proportion of investment in basic research surpassed 6% for the fourth year in a row. Breakthroughs were achieved in several key and core technologies. New steps were taken to increase national strategic scientific and technological strength. Meanwhile, scientific and technological resources ensured the high-quality sports events organization and athletic competitions in the Beijing Winter Olympics. In addition, scientific research breakthroughs contributed significantly to a major and decisive victory in epidemic prevention and control across the country.

This year marks the first year of studying and implementing the guiding principles of the 20th CPC National Congress. To break new ground, the scientific and technological sector needs to be a pioneer in reshaping new advantages in development, be an engine in fostering a new development paradigm, and play a key role in China's modernization drive. At present and in the coming years, we will fully implement the guiding principles of the 20th CPC National Congress and the major decisions and plans of the CPC Central Committee. We will set our sights on four important strategic areas, namely embracing global cutting-edge technology, driving economic growth, meeting the country's critical needs, and improving people's health, and take stock of the state-of-the-art and evolving science and technology trends worldwide to seize major opportunities afforded by the new scientific and technological revolution and industrial transformation. We will move to upgrade home-grown technologies based on the Chinese characteristics of scientific and technological innovation and proceed from the features of scientific and technological development in the new era to ensure national development and strategic security.

We firmly believe that under the strong leadership of the CPC Central Committee with Comrade Xi Jinping at its core, the scientific and technological community will strengthen its confidence in innovation. We will work hard to overcome difficulties, scale new scientific and technological highs, earnestly implement strategic plans put forward at the 20th CPC National Congress, and step up efforts to achieve high-level self-reliance in science and technology. We will get our endeavor to build China into a modern socialist country in all respects off to a good start and make irreplaceable, significant scientific and technological contributions to the modernization drive.

Now, my colleagues and I are ready to share our views on your questions. Thank you.

Chen Wenjun:

Thank you, Mr. Wang. Now the floor is open for questions. Please identify yourself before asking questions.

Xinhua News Agency:

The 20th CPC National Congress identified that education, science and technology, and human resources are the fundamental and strategic pillars for building a modern socialist country in all respects. How do you interpret that? How will the science and technology sector implement it? What are the next steps? Thank you.

Wang Zhigang:

Thank you for your questions. The report to the 20th CPC National Congress devoted a chapter to science and technology, education, and human resources for the first time in history. It suggests that we have developed new strategic thinking in resource allocation and supporting power and resources in our modernization drive. It is about how education, science and technology, and human resources combine to amplify their roles and jointly contribute to modernization. My view is that it is the result of grand strategic considerations. Without strength in education, science and technology, and human resources, there would not be a strong modern country. This reflects our deepening understanding of the law of building a strong modern country and our urgent need for strength in science and technology, education, and human resources in our modernization drive. These three aspects are decisive factors in a country's capacity for development and are of fundamental, far-reaching, and critical significance.

Earlier, education, science and technology, and human resources all played vital roles in the great cause of building a moderately prosperous society in all respects. The plan for these three aspects at the 20th CPC National Congress requires that the three continue to play their roles and form synergy to play a greater role. The relationship between the three is that education is the basis, science and technology are the key, and human resources play an essential role. They are mutually reinforcing and revolve around the modernization drive and the goal of building a strong modern country. As indicated in the report to the Party's 20th National Congress, the three strategies regarding invigorating China through science and education, talent fostering, and innovation will be implemented systematically. Coordinated efforts will be made to achieve the three goals of building strength in human resources, science and technology, and education, so as to build a strong modern country. As we progress, the MOST is ready to work with all relevant departments and local governments to coordinate plans on the three strategies, efforts for the three goals, and resources in the areas of education, science and technology, and human resources, as well as relevant policies, to pool all our strength in our modernization drive and test the outcomes of coordinated development throughout the process.

The actions taken in the science and technology field should center on building a strong country in science and technology. First, we must have greater coordination in top-level design. To build a strong modern country, top-level design in this field should consider education and human resources. Second, we need greater coordination between science and technology and education and more efforts in talent cultivation. We need an overall plan for these three aspects. We have set up relevant mechanisms, The MOST plays the leading role in some cases and the supporting role in others. We should assume primary responsibility when playing the leading role and cooperate with relevant departments to do a good job when playing the supporting role. The emphasis should be placed on scientific and technological professionals. China needs many scientific and technological professionals of high caliber. We need the scientific and technological manpower to be rationally structured to adapt to the needs of the modernization drive, so that we can make innovations with Chinese characteristics and make the country powerful in industries, the economy, and national strength with strong human resources and science and technology capacity. Thank you.

Science and Technology Daily:

My questions are regarding basic research. Much attention has been paid to increasing original innovation capacity, and China has made many plans related to basic research. Mr. Wang mentioned just now that efforts in free exploration and task-oriented projects should be made to boost basic research. What progress in basic research has been achieved so far? Also, how can China further improve its capacity for original innovation? Thank you.

Wang Zhigang:

Thank you for your questions, which are good ones and of great importance. As I said at the beginning, China has always attached great importance to basic research. Since the 18th CPC National Congress, the CPC Central Committee has attached even greater importance to it. General Secretary Xi Jinping said basic research is the wellspring of the entire science system and is key to all technological questions. We have always valued basic research, with breakthroughs made in many areas, especially over the decade since the 18th CPC National Congress. A feature of scientific research is that as we proceed, we find that we are not as knowledgeable as we initially thought. This is the consensus of scientists and illustrates the awe of science. At this stage, our country should attach more importance to basic research, and the participating entities and investment in this area should become more important. 

Since the 18th CPC National Congress, the CPC Central Committee and the State Council have highly prioritized basic research. General Secretary Xi Jinping has made a series of important instructions on it. The Political Bureau of the CPC Central Committee held a group study session on strengthening basic research on Feb. 21. The general secretary made an important speech at the event, stressing that strengthening basic research is imperative for higher-level self-reliance and greater strength in science and technology, and is the only path to building China into a world leader in science and technology . He also called for strengthening overall planning and coordination and increasing policy support to promote the high-quality development of basic research.

The MOST has fully implemented the important instructions of the General Secretary and the decisions and arrangements of the CPC Central Committee. We have formulated a 10-year plan for basic research. Efforts have been made to increase government investment and guide the entire society, including enterprises, local governments, and private actors, as well as donations, to increase investment in basic research and diversify investment channels. Over the years, funding for basic research has grown from 49.9 billion yuan in 2012 to 195.1 billion yuan in 2022, with an average annual growth rate of nearly 15%, nearly twice the growth rate of China's spending on research and development (R&D). In other words, all sectors saw increased investment while the growth rate of basic research has been faster.

China has made significant breakthroughs in basic research, completing a number of national major projects, such as FAST, the steady high magnetic field, and the spallation neutron source. Key projects have also been planned in fields such as quantum information, stem cells, brain science, and synthetic biology. We have progressed in quantum computing, quantum communication, and quantum measurement . We have also made key original achievements with global influence, such as the quantum computer prototype, an artificial method of synthesizing starch from carbon dioxide, and nano-confined catalysis. Carbon dioxide influences the atmosphere, which is a problem. However, if it is combined with other substances and transformed into starch using fine craftsmanship and advanced technologies, it can be applied in various industrial sectors. In doing so, waste materials will be turned into treasures through recycling. These are just a few examples of what technological advancements could bring to us. There are also many other examples concerning national development and security, healthy and sustainable industrial development, and people's lives and health. In particular, major innovation bases, major projects, and high-level teams have played a crucial role together in rapidly strengthening our capacity for original innovation.

We still face some difficulties and shortcomings as we work on basic research. The first challenge in basic research is to pose genuine questions. This is a very challenging task, as it is often said that the key lies in the question rather than the answer. If a question is asked correctly, it can lead research in the right direction. However, if the question is not asked correctly or accurately, your efforts will be much less effective. In other words, results can be achieved more easily if the question is asked correctly. We can ask fundamental questions based on major economic and social development challenges, which means getting to the source of the problem. We can also ask questions based on personal curiosity, which is free exploration. To solve major development problems in the country, both aspects should be given much attention, and we must raise scientific questions based on major challenges, weaknesses and difficulties.

Our country is currently facing technological bottlenecks and weaknesses in some sectors. Getting to the source of the problems and understanding the basic principles and methods of addressing problems requires us to focus on basic research. Developing basic research requires leveraging the roles of excellent teams and talented professionals. Genuine basic research starts with posing questions, proposing fine research methods and paradigms, and ultimately solving problems and answering difficult scientific questions. Meanwhile, it describes laws and methods. To achieve this, we need high-caliber scientists and teams in basic research, who have patriotic sentiments, and possess a sense of honor and pride as well. They should be able to answer and discover scientific problems, describe scientific laws, and have their own scientific opinions and unique insights. Their sense of honor and pride should be reflected in this aspect and be remembered for years, decades, and even centuries to come. We remember figures like Newton, Einstein, Planck and Pasteur because they made discoveries and summarized new laws, which is exactly what basic research demands.

Next, we will follow the important instructions on scientific and technological innovation and basic research given by the General Secretary. We will implement the guiding principles of his speech at the group study session of the Political Bureau of the CPC Central Committee. We will focus on major original innovations and build platforms for developing goal-oriented basic research, market-oriented applied basic research, as well as basic research based on free exploration. In doing so, we will allow everyone to have a stage to showcase their abilities and unleash their imagination and intelligence. First, we will strengthen frontier-oriented exploratory basic research. Looking forward and taking the next step is always a challenging task. Second, we need to promote strategy-oriented systematic basic research. The CPC Central Committee has proposed some major strategic goals, and it is necessary to support these goals with science and technology. The 20th CPC National Congress has made a series of plans for building a great modern socialist country, such as building up China's strength in education, aerospace, and transportation. It is necessary to provide talent and technological support to achieve these goals. We must strengthen the systematic layout of strategy-oriented basic research, just like "linking pearls into a necklace." Third, we will advance market-oriented applied basic research. We need to identify problems found in the application, get to the source of the problem, and work to find answers and methods.

At the same time, we need to optimize the structure of fundamental disciplines and support the penetration and diffusion of science and technology into various sectors. We also need to recognize that the real hope of science and technology lies in the younger generation of scientists. Therefore, we should provide more opportunities and a broader stage for young scientists to unleash their intelligence, shoulder primary responsibilities, and make significant contributions, thereby gaining recognition from the scientific community.

Finally, I want to say that basic research is a process that requires people to devote themselves wholeheartedly to research, which often means boldly exploring an entirely new field where no one has ventured before. It can be difficult to see which direction to take while pursuing development in basic research. Proceeding requires a strong foundation of scientific knowledge, excellent scientific thinking, and analytical skills. Some explorations may fail. Due to the low probability of success in scientific research, especially in scientific discoveries, scientists must be prepared for failure and persist in the face of setbacks. From the perspective of attitude and methods, the path of science is always rocky, and success is not guaranteed. An ancient saying states, "it's better to be diligent than too clever." It means that people need to be hardworking and challenge themselves constantly. Only then can they achieve significant results after persistent long-term efforts. I want to invite friends from the media to pay more attention to basic research, as well as science and technology. We should guide the public to value science and technology from a young age, encourage them to learn and make the best use of science and technology, and eventually become someone who understands and even takes pride in their involvement in science and technology. Thank you.

Zhejiang Daily:

For enterprises, innovation concerns their long-term development. The report to the 20th CPC National Congress proposed reinforcing enterprises' principal role in scientific and technological innovation. Concerning that, what will the MOST do? We are interested in whether there are any policies and measures to support enterprises, especially sci-tech enterprises. Thank you.

Wang Zhigang:

Thank you for your question. This question is fundamental; we will have Mr. Wu Zhaohui answer it.

Wu Zhaohui:

The 20th CPC National Congress made a clear decision about reinforcing the principal role of enterprises in scientific and technological innovation. The change from enterprises assuming a predominant role in technological innovation to the central role in scientific and technological innovation demonstrates at least two facts. One is that increased importance is attached to the role of enterprises in the national innovation system. The other is that enterprises will play a more prominent role in whole-chain innovation. Enterprises will not only maintain the principal role in technological innovation, application of scientific and technological achievements, and incubation of industries but will also play a greater role in basic and application-oriented research. Making enterprises play the principal role in scientific and technological innovation is a natural requirement for building greater scientific and technological strength, which can be interpreted from two perspectives. From the perspective of enterprises, as the basic unit of economic activity, they are geared toward diverse market needs and sensitive to product innovation and industrial innovation. At the same time, scientific and technological needs mainly come from enterprises, and they facilitate the commercialization of scientific and technological advances. Therefore, from this perspective, enterprises are the most dynamic force of innovation.

The second perspective is that science and technology support high-quality development. China has entered the stage of innovation-driven high-quality development, which requires enterprises, as a critical point linking innovation chains and industrial chains, to play an adhesive or even a leading role in removing impediments along the links of basic research, technological and industrial innovation. At the same time, it also requires enterprises to make more efforts in basic research, application-oriented research and research and development (R&D) on pioneering technologies, which is also the general practice and successful experience of major leading countries in science and technology.

Setting our sights on greater self-reliance and strength in science and technology, we need enterprises to take on greater responsibilities. Confronted with new requirements in the future, whether enterprises can genuinely play the principal role in innovation depends on whether they can lead more universities and research institutions to jointly accomplish and promote high-level goal-oriented research and development. It also depends on whether enterprises can establish an incentive mechanism for innovation to attract more high-level talents and jointly create market value. Moreover, it also depends on whether these enterprises will cooperate internationally and whether they can achieve win-win outcomes through opening up and innovation. In the final analysis, the solution to these key problems depends on raising enterprises' capacity for scientific and technological innovation, and ultimately, market validation is needed to test the innovation capacity of enterprises. Therefore, only through innovation can development be achieved.

According to the deployments and requirements of the CPC Central Committee, the MOST has continued to make efforts on policies, production factors and projects to support enterprises to improve innovation capacity. Specifically, stronger support has been given to decision-making, investment in R&D, scientific research organization, and the application of scientific and technological advances. Next, focusing on "reinforcement in four aspects," we will continue to enhance the principal role of enterprises in scientific and technological innovation.

First, we will reinforce the principal role of enterprises in decision-making on scientific and technological innovation. We will continue to facilitate greater and wider participation of enterprises in national scientific and technological innovation decision-making. Specifically, we will recruit science and technology experts from the business community into the national pool of science and technology experts, establish the advisory meeting system of entrepreneurs on scientific and technological innovation, and guide enterprises to carry out R&D in combination with major national strategies.

Second, we will reinforce the principal role of enterprises in R&D investment. According to statistics, enterprises' investment in R&D in 2022 accounted for over three-fourths of the total investment in R&D across China, which is a very good trend. We will continue to support enterprises to increase their investment in R&D and advance the implementation of policies on granting additional tax deductions for R&D costs and others. At the same time, we will set up a working mechanism for offering financial support to the innovation of enterprises to remove barriers along the scientific, technological, industrial and financial chains.

Third, we will reinforce the principle role of enterprises in organizing scientific research. About 80% of key national science and technology R&D programs are participated in or led by enterprises. We will continue to work on that to enable more enterprises to take the lead in organizing national science and technology programs. We will also encourage more enterprises to identify their needs in science and technology, giving play to the role of enterprises in setting the questions, providing the answers, and reviewing the results.

Fourth, we will reinforce the principal role of enterprises in the commercialization and application of scientific and technological advances. In 2022, the volume of contracted technology transactions reached 4.8 trillion yuan, and enterprises contributed over 80% of contracted technology absorption. That is an excellent signal. We will further optimize policies to increase enterprises' capacity for absorbing and commercializing scientific and technological advances. Meanwhile, we will promote effective interaction between the technology trading market and technology transfer institutions to build a high-quality and high-standard technology market to pool together all kinds of scientific and technological advances at the enterprise level. 

At last, let me emphasize again that innovation has nothing to do with its origins. All enterprises, big or small, state-owned or private, should enjoy equal rights, equal opportunities, and equal rules in the process of innovation. The MOST will provide better services and stronger support and create fair and equitable policy environments for enterprises to enhance their innovation capacity and enable them to make greater contributions to innovation. Indeed, while prioritizing enterprises' principal role in scientific and technological innovation, we will also give full play to the role of research institutes and universities. Thank you.

Wang Zhigang:

It is an essential requirement for enterprises to hold the principal position in scientific and technological innovation. China is now a socialist market economy, and enterprises are the main participants of market economies. To strengthen our science and technology to provide support for China's high-quality development, and to become a great modern country, enterprises must play a principal role. In this process, it is a requirement for the enterprises themselves to continuously improve their own independent scientific and technological capabilities. At the same time, support from the state is also an opportunity, which is an inevitable requirement for development. This year we will also work together with relevant departments, localities and high-tech enterprises. Over the years, we have done a lot of work. The number of high-tech enterprises has reached 400,000, and the number of small- and medium-sized high-tech enterprises has reached 500,000. Their R&D investment accounts for 68% of the national enterprise R&D investment. They are the pioneers of new industries and new markets, and a central pillar to ensure the healthy development of national enterprises and industries. This force needs to be further expanded and improved, both in terms of scale and quality. Thank you.

Reuters: 

Recently, ChatGPT has evoked widespread response in China. I would like to ask how the MOST views this kind of AI-driven technology. In terms of supervision, what considerations does the MOST have? Thank you.

Wang Zhigang:

Thank you for your question. ChatGPT is a hot topic. I'd like to invite Mr. Chen Jiachang to answer your question.

Chen Jiachang:

As a strategic emerging technology, AI has increasingly become an important driving force for technological innovation, industrial upgrading and improving productivity. Human-computer dialogue based on natural language understanding is an important direction for the development of AI. The ChatGPT application you mentioned has recently become a phenomenon, showing a high level of human-computer interaction. It also shows that the large natural language model already has some characteristics progressing towards artificial general intelligence (AGI) and has broad application potential in many industries.

In terms of AI development trends, there are two very obvious characteristics. First, AI has a penetrating, spreading and disruptive impact on social and economic development. Especially in the fields of scientific research, AI provides new methods and new approaches for some research in biological science, materials science and energy studies, and is leading the paradigm shift in scientific research. Second, driven by the internet, big data, supercomputing, intelligent computing, and brain and cognition-related technologies, AI technology is developing rapidly, showing a trend of group breakthroughs. The paradigm of "intelligence +" has been widely used in manufacturing, transportation, medical care and other fields. In some "dark factories ," the process is highly automated with no human intervention, which greatly improves the energy efficiency of production. In the medical field, the AI-assisted diagnosis and treatment system covers more than 3,000 common diseases and has been applied in more than 27,000 community-level medical institutions, showing that AI has achieved far-reaching penetration.

In terms of China's plan for developing R&D and the progress it has made, the Chinese government places great importance on AI. In 2017, the State Council introduced a development plan for the new generation of AI. Under the guidance of this plan, the MOST set up an office for advancing AI development, a strategic advisory committee, and a committee for AI governance. Over the past two years, the ministry has also introduced the Governance Principles for the New Generation Artificial Intelligence, and Ethical Norms for New Generation Artificial Intelligence. Key scientific and research projects on AI have been launched. We have established the "one body, two wings" R&D structure, with basic software and hardware as the "main body" and basic theories and innovative application as the "two wings." We have collaborated with leading companies to establish a number of open innovation platforms for AI, aimed at supporting small- and medium-sized enterprises (SMEs) and accelerating technological advancement across the industry. We have established 18 national innovation pilot zones, encouraging localities to introduce application scenarios with their own characteristics in line with local conditions. Our efforts have yielded significant progress. Domestic scholars have proposed the concept of "neuromorphic completeness ," and developed the heterogeneous fusion brain-inspired computing chip. Additionally, domestic scientific research institutions have developed a Chinese multi-modal pre-training model and omni-perception pre-trainer , which are among the most technologically advanced in the world.

Going forward, the MOST will recognize AI as an emerging industry of strategic importance and a new driving force for the economy. We will continue to provide support in the following aspects: First, we will work to build an open and coordinated system for AI innovation, accelerate basic theoretical studies and achieve breakthroughs in key technologies. Second, we will further integrate AI into social and economic development, improve our technologies in major application scenarios, and foster the market. Third, we will promote the development of a safe and manageable governance system. Fourth, we will advance open cooperation on AI in all areas. Thank you.

Wang Zhigang:

I would like to add that ChatGPT is indeed quite popular. Mr. Chen just briefed us on the relevant information. The journalist's questions mainly cover two aspects: how to view ChatGPT and how to deal with ethical issues. While promoting the development of AI, we should also take into account the need to strengthen ethical norms. ChatGPT itself is a large model which is based on a large amount of data, powerful computing capacity and highly efficient algorithms. As mentioned earlier, there have been advances in natural language understanding and processing, as well as the effective integration of algorithms, data and computing power.

For all new technologies, including AI, China has taken targeted measures in terms of ethics to avoid potential risks and better leverage the benefits of technology. Thank you. 

China Daily:

The report to the 20th CPC National Congress stressed the importance of expanding international exchanges and cooperation on science and technology, fostering an environment that is conducive to scientific research and up to international standards, and building an open and globally competitive ecosystem for innovation. In light of this, what plans does the MOST have for future international sci-tech cooperation? Thank you.

Zhang Guangjun: 

Science and technology play a crucial role in today's world and their significance has been recognized worldwide. The Chinese government is committed to expanding sci-tech cooperation. In the course of reform and opening-up, China has taken the lead in strengthening sci-tech openness. As Mr. Wang mentioned in his opening remarks, China is both an important participant in international frontier innovation and a significant contributor to solving global problems. I will address your question from three aspects:

First, we will actively promote new progress in mutually beneficial inter-governmental cooperation. We have established sci-tech partnerships with over 160 countries and regions, signed 116 inter-governmental sci-tech cooperation agreements and built a new pattern of comprehensive, multi-tiered and wide-ranging sci-tech cooperation. In 2022, sci-tech cooperation contributed significantly to head-of-state diplomacy and major national diplomatic events, producing a range of important cooperation outcomes. Additionally, we held 48 inter-governmental cooperation conferences on science and technology, and signed and renewed 25 sci-tech cooperation agreements. We have conducted in-depth, practical and effective cooperation with a number of countries in various fields such as the science-based fight against epidemic, as well as biodiversity, climate change and clean energy. The progress we achieved in areas such as poverty alleviation through scientific and technological efforts, innovation and entrepreneurship, technology transfer, and space information and services have benefited more countries and people, and further promoted sci-tech cooperation under the Belt and Road Initiative.

Second, we will actively engage in the global governance system, focusing on proposing China's approach and making contributions to addressing common challenges facing humanity. We will take the initiative in establishing the global sci-tech innovation agenda, including promoting international cooperation on pandemic through sci-tech efforts, building the BRICS Vaccine Research and Development Center , launching the "Green Power Future Mission" and developing plans for international sci-tech cooperation on achieving carbon neutrality. Major international science programs and projects initiated by Chinese scientists have made significant progress. In addition, Chinese scientists have made great achievements in other major science programs and projects, such as nuclear fusion reactors and the Square Kilometer Array radio telescope. China has become increasingly influential in important international sci-tech organizations, with improved contributions, voice and leadership.

Third, we have further stepped up efforts in science and technology opening-up, fostering a sound environment for openness and innovation. We have established a pilot fund that is globally oriented to support scientific research, which allows foreign scientists to lead and participate in China's national science and technology programs. This will encourage scientists from all over the world to conduct research jointly on major issues and enhance their capacity to address the problems of mankind. At the same time, we have rolled out several more open and effective policies concerning the work and life of foreigners and foreign talents in China. We have encouraged and supported Chinese research institutes, universities, enterprises, local governments and researchers to actively engage in international cooperation and exchanges. This will realize the dual drive by the government and the private sector and promote people-to-people exchanges, integration of ideas, unimpeded connectivity of production factors, and connectivity of facilities.

The 20th CPC National Congress has provided a clear direction for international innovation and cooperation in science and technology. Next, we will further strengthen the leading role of head-of-state diplomacy, actively integrate into the global innovation network, strengthen the interconnection between governments, and deepen people-to-people exchanges. We will also expand the scope and depth of international exchanges and cooperation in science and technology, establish new platforms for international science and technology exchanges and cooperation in key regions, countries and sectors, and adopt several institutional policy reforming measures at the International Center for Science and Technology Innovation, and further open up our science and technology programs to the world. Going forward, China's door of opening-up and cooperation for science and technology will only open wider. We will work hand in hand with other countries to contribute more Chinese wisdom and strength to promoting human progress and building a better world while carrying out the mission of innovation in science and technology to build a global community with a shared future . Thank you.

Red Star News:

Innovation in science and technology is rooted in people. Therefore, what progress has the MOST made in training and developing scientists and technologists? Additionally, what impact has reducing the workload of researchers had? Furthermore, what measures will be taken to stimulate innovation and development potential of researchers, particularly young talents? Thank you.

Xie Min:

The essence of innovation-driven development is talent-driven development. Talent serves as the fundamental element and the starting point as well. All science and technology innovation activities revolve around talented individuals. Since the 18th CPC National Congress, China has been continuously deepening the reform of talent assessment, improving the incentive mechanism for science and technology, thereby fully unleashing the vitality of talent. The MOST has always placed human resources development in science and technology high on the agenda, giving priority to addressing the concerns, thoughts, and expectations of scientists and technologists. We have created a favorable ecological environment for innovation in science and technology and made good progress in human resources development in science and technology.

First, talent development has achieved a simultaneous improvement in both quantity and quality. In 2022, the full-time equivalent of R&D personnel in China exceeded 6 million person-years, maintaining the world's first position for many years. The structure of the talent pool has been further optimized, with more leading talents and high-level innovation teams emerging, including more outstanding young scientists and technologists. The ability and role of science and technology talent in supporting high-quality development have been significantly enhanced.

Second, the systems and mechanisms for stimulating the vitality of science and technology talent are increasingly improving. Last year, China issued the Opinions on Improving the Incentive Mechanism for Science and Technology to strengthen incentives for missions and contributions. The MOST has worked with the Ministry of Finance, the Ministry of Education, the State-owned Assets Supervision and Administration Commission, and the Chinese Academy of Sciences to solve the problems and difficulties encountered by scientists and technologists and supported them by easing their burden, and providing encouragement. We have deepened reforms in evaluations of programs, human resources, and organizations. We have rolled out many measures to reduce the reliance on papers, education, qualifications and awards in title assessment and emphasized moral character, ability, performance and contribution. We have continued our efforts to reduce their burden and introduced more than 10 specific measures, such as reducing application forms for projects, simplifying expense claim procedures, and streamlining organizations.

We have taken further steps to enhance the development of young science and technology talent by implementing new initiatives in five aspects, namely, encouraging them to take on greater responsibilities, providing more opportunities, reducing evaluations, giving them more free time, and improving their physical and mental health. Our support enables them to play a significant role in their work. Over 80% of researchers participating in key national R&D projects are under the age of 45. 

Third, we have accelerated the internationalization of our science and technology talent pool. International talent exchanges help promote the spread and sharing of knowledge. China is also a fertile land for innovation among international scientists and technologists. We have implemented a more open talent policies and facilitated the work and life of foreign talent in China. With a focus on sustainable development, we have launched joint R&D plans and innovation, and engaged in collaborative research with more than 50 countries and regions, building a hub for attracting and nurturing outstanding talent in scientific research and innovation.

Next, in accordance with the decisions of the 20th CPC National Congress and the guiding principles of the Central Conference on Talent-related Work, the MOST will continue to take coordinated action in education development, innovation in science and technology, and human resources development. We will further implement the workforce development strategy in the new era. With the goal to accelerate the building of a world-class talent center and innovation hub, we will strengthen national mission-oriented development and coordinate domestic and international human resources. We will also work to reform the systems and mechanisms of science and technology to strengthen services, guarantees, and incentives, and create a favorable environment for innovation and entrepreneurship. We will build a large, well-structured and high-caliber pool of human resources in science and technology to provide strong talent support for China's high-level scientific and technological self-reliance. Thank you.

Hong Kong Bauhinia Magazine:  

The number of new- and high-tech development zones in China has nearly doubled compared with a decade ago. Successful outcomes from pilot reforms of national innovation demonstration zones have also been made, giving rise to practices applicable to other areas. Can you exemplify and elaborate on the situation in this field? What measures will be taken next to better leverage such zones' role in leading the development of their surrounding areas? Thank you.

Wu Zhaohui:

Establishing national new- and high-tech development zones and innovation demonstration zones are major strategic plans made by the CPC Central Committee and the State Council. The first national new- and high-tech development zone was approved in 1988, and the strategic direction of "developing advanced science and technology, realizing industrialization" has since been established. The national innovation demonstration zones, established in 2009, further carried out trial and reform work focusing on independent innovation. Since the 18th CPC National Congress, 177 national new- and high-tech development zones and 23 national innovation demonstration zones across China have fully implemented the requirements to pursue high-quality development and innovation. They have played an important role in leading the development of their surrounding areas. They have blazed a path of new- and high-tech industrialization with Chinese characteristics. They have also become a pilot for sci-tech institutional reforms, a pacesetter for innovation-driven development, and a pioneer for high-quality development. In 2022, new- and high-tech development and innovation demonstration zones sustained dynamic growth momentum and contributed 13.6% of the nation's GDP. They also rank among the highest in terms of energy conservation. Their energy consumption per 10,000 yuan of industrial-added value was two-thirds of the national average. These two kinds of zones also play a vital role in stabilizing economic growth.

A review of the development of new- and high-tech development zones and innovation demonstration zones over the past decade shows that this sector's significant achievements and breakthroughs lie in high-quality development and innovation. The high-quality development of these two kinds of zones can be seen in the following three aspects. First, high-quality innovation resources have been pooled at an accelerated pace. The R&D spending of national new- and high-tech development zones accounts for nearly half of the investment in R&D by domestic enterprises. The number of valid invention patents possessed by enterprises in such zones also accounts for nearly half of the nation's total. These zones are also home to nearly half of the national-level innovation platforms. Second, high-growth enterprises keep emerging. National new- and high-tech development zones have attracted over one-third of domestic sci-tech SMEs, one-third of domestic new- and high-tech enterprises, and two-thirds of companies listed on the Shanghai Stock Exchange Science and Technology Innovation Board. Third, high-end industries continue to grow. For example, the industrial scale of information and communication technology (ICT) in Beijing's Zhongguancun national high-tech industrial development zone accounts for 17% of the nation's total. The size of the biomedical industry in 36 new- and high-tech development zones in the Yangtze River Delta exceeds half of the nation's total. The innovation demonstration zones in the Pearl River Delta have developed a group of trillion-yuan industrial clusters such as those involving advanced materials. All these three aspects speak volumes about the significant achievements of new- and high-tech development zones.

In addition, innovation is another achievement of new- and high-tech development zones and innovation demonstration zones, and it can also be summarized in three aspects. First, new- and high-tech development zones have become the birthplace of major original outcomes. For example, the first AI chip and the first prototype superconducting quantum computer were all made in such areas. Meanwhile, new- and high-tech development zones have also become major hubs for exploring new development paths and nurturing future-oriented industries. For instance, new business forms involving smart robots, satellite navigation, and cell and gene therapy were born in such areas. The second aspect is reform. Innovation demonstration zones have always led the way in reform, and all 23 such zones have rolled out a series of original and guiding policies to promote independent innovation. For example, Beijing's Zhongguancun national high-tech industrial development zone carried out pilot programs to give more autonomy in using research funding. It also introduced reform measures allowing enterprises to use scientific research outcomes before paying related research institutions. These popular moves have created a sound social atmosphere featuring innovation and business ventures. The third aspect is about innovative measures for opening up. Both new- and high-tech development zones and innovation demonstration zones value globalized development. Over 70% of new- and high-tech development zones have introduced policies regarding international matters. They have also established over 2,200 R&D institutions overseas, which facilitates a new pattern of opening up and cooperation.

Regarding the plans for new- and high-tech development zones and innovation demonstration zones, we will follow the general requirements of fully implementing the guiding principles of the 20th CPC National Congress. We will further underscore the strategic position of these zones, enhance brand-building and improve development capacity. We will continue to make efforts in the following three aspects. First, we will keep reaching new heights based on our achievements. We will continue developing world-class enterprises and industrial clusters, enhancing the capacity for original invention and nurturing future-oriented industries to create an upgraded version of high-quality new- and high-tech development zones and national innovation demonstration zones in the new era. Second, we will keep deepening reform. Reform measures for national innovation demonstration zones have long played a leading role. We will further scale up efforts to implement innovation demonstration zone piloting and reform measures. Reform efforts in the next step will focus on two aspects: high-level sci-tech self-reliance and a high-level ecosystem for innovation and business ventures. Third, we will continue to coordinate our efforts. We will further enhance coordination between new- and high-tech development and innovation demonstration zones and tap the innovation potential of such coordination. We will create a strategic cluster to support building an innovative country and a strategic pivot to integrate into a global innovation network. We will follow the strategic direction of these three aspects, further enhance the brand-building of both kinds of zones with the aim of high-quality development and innovation, and contribute to building China's strength in science and technology. Thank you.

Chen Wenjun:

Due to the time limit, this will be the last question.

China Media Group:

The 20th CPC National Congress made comprehensive and systematic arrangements for improving systems for scientific and technological innovation . What has the MST done to boost the overall performance of China's innovation system , and what are the plans going forward? Thank you. 

Wang Zhigang:

Overall, China's innovation system is based on science, has improved, and performs well. Yet it needs constant upgrading. That is because China has transformed from making breakthroughs in some science and technology to achieving general advances. Science and technology have been central to the country's overall development.

The strength of a major country relies on its capacity for sci-tech innovation. We often say that the relationship between capacity and achievements, as well as products, is dominated by capacity. Capacity is the cause that leads to products. Therefore, one can only do what is within their capabilities. Increasing our capability is our starting point and focus, and we need to do this in accordance with the national strategy. Now, we are positioned to join the ranks of the world's most innovative countries and build China into a leading country in science and technology, developing China into a great modern country. To this end, what is important is to have systematic capacity instead of capacity in a single area. How can we improve and upgrade our ability? How can we make the innovation system sounder? A significant answer is reform. This is a key measure. Reform is needed to continuously improve the innovation system and capacity for sci-tech innovation to build China into a country of innovators. During these years, we have always kept the following in mind: reform drives innovation, and innovation drives development. Sci-tech institutional and mechanical innovation also constitutes a type of reform needed to improve the national innovation system with Chinese characteristics.

First, we will focus on national strategic goals and promote organized scientific research to form a systematic landscape. To promote systematic sci-tech innovation, we must set our sights on the global frontiers of science and technology, national economic development, the country's major needs, and people's health and safety . We have fully motivated scientific researchers by cooperating with the relevant departments. We have taken measures such as easing burdens, choosing the best through fair selection, and opening a competition mechanism to select the best candidates to undertake key research projects . We support scientific researchers in their genuine, unwavering devotion. We have adopted a level- and category-based management approach and proposed corresponding measures to make the national innovation system more efficient. Reform uncovers and solves problems through scientific research practices, further improving institutions.  

Second, we will stay mission-oriented. Building China into a country of innovators, a leading country in science and technology and a great modern country is a great goal for us and an essential mission for sci-tech innovation. We must concentrate on the mission, improve the ability system, consolidate national strategic sci-tech strength, and cultivate pro-innovation environments in the policy, law, cultural and social fields. In addition, allocating scientific research resources and ways of sci-tech appraisal should also be constantly reformed and improved to fulfill the mission.

Third, we will create an environment that encourages innovation. The innovators are not governments but universities, scientific research institutions, national labs, enterprises, and all other participants in society. These participants are willing to devote themselves to science and technology, conduct scientific research, and can secure achievements. We will strive to develop a favorable ecosystem in such fields as law, policy, culture and society to make more people interested in sci-tech innovation, understand and participate in it, and take it as their own noble cause of life. We must strive to improve the national innovation system.  

Fourth, we will coordinate the innovation layout. Unbalanced and inadequate development remains a major problem in China. The eastern, central and western regions, as well as urban and rural areas, are all different. However, all eagerly seek and hope to participate in science and technology. We need to take this into full account while making the layout. Universities, scientific research institutions, national labs, and enterprises have different roles to play. We need to let various innovators pinpoint their roles in the national innovation system, play their roles, and support and serve national goals through their sci-tech innovation practices. The national innovation system needs to coordinate basic research, application-oriented basic research, technological innovation, sci-tech applications and high-tech industrialization, and connect every link to make them perform efficiently and jointly support building China into an international leader in science and technology. In addition, diverse resources must be coordinated and allocated efficiently. All the resources of platforms, funds, the workforce and policies should be pooled to achieve national strategic goals, especially to build China into a leading country in science and technology. All the dimensions and links involved in every dimension form the innovation system. To support building China into a country of innovators and a leading country in science and technology and further to develop China into a great modern country, we need to serve the national strategic goals and interconnect various innovation activities toward the goals. In addition, we must constantly improve the national innovation system and make it perform more efficiently, and fully arouse the dynamism, vitality, and initiative of sci-tech personnel. We will encourage scientific researchers to realize their value through their work and contribute to scientific development to achieve a sense of honor in society. All of these are the focuses of our work. 

The MST will further study, grasp and implement the guiding principles of the 20th CPC National Congress, especially its arrangements for sci-tech innovation, in all our work to let science and technology play a real, irreplaceable role in China's modernization drive. 

I hope our media friends care about and support our sci-tech work. Not only before the annual two sessions, but at other times, I hope you can pay more attention to, support and advocate science and technology. In addition, I hope you can guide society to pay attention to and support sci-tech development, talent and empowerment so that science and technology can better lead development and drive it to an even higher level. Thank you. 

Chen Wenjun:

Thanks to Mr. Wang and the other speakers, as well as friends from the media. Today's briefing has now concluded. 

Translated and edited by Xu Xiaoxuan, Wang Qian, Zhang Jiaqi, Liu Sitong, Cui Can, Yuan Fang, Xu Kailin, Wang Yanfang, Yan Bin, Huang Shan, Zhou Jing, Duan Yaying, Zhang Rui, Zhu Bochen, Wang Yiming, Ma Yujia, Li Huiru, David Ball, Tom Arnsten, and Jay Birbeck. In case of any discrepancy between the English and Chinese texts, the Chinese version is deemed to prevail.

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Read in Chinese

Speakers:

Mr. Li Xiaopeng, minister of transport

Mr. Xu Chengguang, vice minister of transport

Chairperson:

Ms. Xing Huina, deputy director general of the Press Bureau of the State Council Information Office (SCIO) and spokesperson of the SCIO

Date:

Feb. 23, 2023

Xing Huina:

Ladies and gentlemen, good afternoon. Welcome to this press conference held by the State Council Information Office (SCIO). This is the third briefing in the series "Embarking on the New Journey — A Government Perspective." Today, we are joined by Mr. Li Xiaopeng, minister of transport, and Mr. Xu Chengguang, vice minister of transport. They will brief you on the efforts being made in moving faster to boost China's strength in transportation and striving to make transportation development a pioneer in China's modernization drive, and then take your questions.

Now, I'll give the floor to Mr. Li Xiaopeng for a brief introduction.

Li Xiaopeng:

Thank you, Ms. Xing. Ladies and gentlemen, friends from the media, good afternoon. It is a great pleasure to attend this press conference and meet with you. On behalf of the Ministry of Transport (MOT), I would like to express to you my heartfelt gratitude for your long-standing interest in, support and help for, as well as supervision of China's transportation development.

In 2022, under the strong leadership of the Communist Party of China (CPC) Central Committee with Comrade Xi Jinping at its core, the transportation sector earnestly implemented the requirements to ensure effective COVID-19 containment, economic stability and safe development. It worked to prevent and control the pandemic in a targeted and well-conceived manner, and spared no efforts to ensure unimpeded transportation and safe production. It also worked to scale-up effective investment and solve difficulties facing businesses. As a result, the transportation sector has completed all tasks involved in its annual targets and achieved a good performance.

This year marks the first year of implementing the guiding principles from the 20th CPC National Congress. The transportation sector will earnestly act on Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era and the guiding principles of the 20th CPC National Congress, making both as our primary political tasks and long-term strategic missions, and implementing the guiding principles with determination.

General Secretary Xi Jinping has attached great importance to the development of transportation. He has pointed out that since the founding of the People's Republic of China, generations of Chinese people have worked in the spirit of building roads through mountains and putting bridges over rivers, and turned China into a country with vast transportation infrastructure. Today, we are redoubling our efforts to build a country with great transportation strength. Transportation development has become a pioneer in China's modernization drive. He also fully recognized the hard work, the sense of responsibility and commitment, and the significant contributions of officials and staff in the sector. General Secretary Xi Jinping's important instructions have charted the course for the transportation sector and provided fundamental principles for our work. We will follow the guidance of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, and continue implementing the guiding principles of the 20th CPC National Congress and General Secretary Xi Jinping's important instructions on transportation development. We will also work hard, shoulder our responsibilities and devote ourselves to expediting the building of a nation strong in transportation. The transportation sector will strive to be a pioneer in China's modernization drive, and make persistent efforts and new contributions toward building China into a great modern socialist country.

This year, we will formulate and roll out a five-year action plan to expedite China's transformation into a transportation powerhouse (2023-2027). We will work to prevent and control the pandemic in the transportation sector in a targeted and well-conceived manner, and ramp up efforts to ensure unimpeded transportation and safe production. We will advance the construction of integrated multidimensional transportation networks , expand effective investment in the field, improve transportation service and support capacity, and further adjust and optimize the nation's transportation structure and foster its green and low-carbon transformation. We will also expedite the building of a unified and open transportation market and promote global cooperation in the transportation sector. We will resolutely exercise full and rigorous Party self-governance, strengthen Party building, improve conduct, build integrity and combat corruption. In the coming period, we will also work to ensure sound transportation services and support for the annual sessions of China's top legislature and political advisory body.

In short, we will make concerted efforts and strive to accomplish all tasks this year, so as to live up to the expectations of the Party and the people. That concludes my introduction. Next, Mr. Xu and I will take your questions. Thank you.

Xing Huina:

Thank you, Mr. Li. Now the floor is open for questions. Please identify the media organization you work for before asking your questions.

Tide News:  

After the 19th CPC National Congress put forward the building of a nation strong in transportation, the 20th CPC National Congress stipulated the efforts to move faster to boost China's strength in transportation. What progress has been made in this regard over the past five years? What are the plans and arrangements going forward? Thank you.

Li Xiaopeng:

Thank you for your questions. Moving faster to boost China's strength in transportation is a major strategic decision made by the CPC Central Committee with Comrade Xi Jinping at its core in light of the national conditions, the overall interests and the future development. As you said, the 19th CPC National Congress put forward the building of a nation strong in transportation, and the 20th CPC National Congress noted the efforts to move faster to boost China's strength in transportation. General Secretary Xi Jinping has attached great importance to the issue. As I mentioned earlier, he stressed that, "since the founding of the People's Republic of China, generations of Chinese people have worked in the spirit of building roads through mountains and putting bridges over rivers, and turned China into a country with vast transportation infrastructure. Today, we are redoubling our efforts to build a country with great transportation strength." He also noted that "transportation development has become a pioneer in China's modernization drive." The CPC Central Committee and the State Council issued the Outline for Building China's Strength in Transportation and the Outline for National Comprehensive Transportation Network , which further improved the top-level design accordingly. The MOT has earnestly implemented the decisions made by the CPC Central Committee and the State Council, continuously advancing the work in all respects, and got off to a good start in the matter.

First, the infrastructure network continues to be improved. During the five years since the 19th CPC National Congress, which is from 2018 to 2022, fixed-asset investment in the country's transportation sector exceeded 17 trillion yuan, and China built the world's largest high-speed railway and expressway networks as well as a world-class port cluster. By the end of 2022, the total length of the country's comprehensive transportation network exceeded 6 million km. In breakdown, the operating mileage of the railway network reached 155,000 km, of which high-speed railways accounted for 42,000 km. The country had a total of 5.35 million km of highways by the end of 2022, of which expressways represented 177,000 km. China now has 21,000 quay berths for production use , including 2,751 for berths of 10,000-tonne-class or above. The length of navigable inland waterways reached 128,000 km, including 15,000 km of waterways of level three and above which can be used for ships of 1,000 metric tons or more. The number of certified civil airports across the country reached 254. Urban rail transit now runs across 53 cities in China, with operating length totaling 9,584 km. In terms of rural roads, all villages, townships and towns with the necessary conditions have access to paved roads and bus routes. Regarding the postal service, there are now postal service stations in every village, and every township has access to such services. A group of major projects has also been built and put into operation, such as the Hong Kong-Zhuhai-Macao Bridge, Beijing Daxing International Airport, Phase IV of the Shanghai Yangshan Deep Water Port and Beijing-Zhangjiakou high-speed railway line, to name a few. Construction of other major projects such as the Sichuan-Tibet Railway, Shenzhen-Zhongshan link and Pinglu Canal is also being expedited. This is the first aspect of the achievements, which is the continuously improving infrastructure network.

Second, transportation services have been continuously improved. We have promoted the quality of travel services, ensured smooth logistics flow, and pushed the rapid development of new business forms. As a result, China's key transportation indicators – including passenger and freight volume and business volume of postal and express services – rank first worldwide. In 2022, the country's commercial passenger volume hit 5.59 billion, its commercial freight volume stood at 50.6 billion tonnes, its port throughput amounted to 15.68 billion tonnes, and its container throughput exceeded 300 million twenty-foot equivalent units (TEUs). Data related to people's livelihood showed that expressway travel volume of passenger vehicles with less than nine seats surpassed 17.1 billion, and average daily ride-hailing and bike-sharing orders exceeded 20 million and 33 million, respectively. In addition, express delivery volume surpassed 110 billion, and express delivery companies handled an average of more than 300 million parcels daily.

Third, high-quality development has been promoted. The planning system in the transport sector has been advanced, as China issued a comprehensive transportation plan for the 14th Five-Year Plan (2021-2025) period, as well as the medium- and long-term plan for the highway network. In addition, scientific and technological innovation has significantly increased. We have further advanced green and low-carbon transformation, improved talent training and management, continuously deepened reform, and optimized laws, regulations, and the business environment.

Fourth, international cooperation has been boosted. Many international cooperation projects, such as the China-Laos Railway and the China-Russia highway bridge, have been completed and put into operation. China-Europe freight trains have now reached more than 200 cities across 25 countries in Europe. More than 300 international passenger and freight transit lines have been opened, and shipping services now serve all coastal countries along the Belt and Road. Domestic airlines operate regular international flights to 153 cities in 62 countries, and postal and express services connect more than 220 countries and regions worldwide.

To put it simply, during the past five years, China's comprehensive strength in the transportation sector has been significantly enhanced, with some advanced fields ranking first globally, which guarantees the building of a moderately prosperous society in all respects and the building of a modern socialist country.

Next, the MOT will formulate and implement a five-year action plan to accelerate the building of China's strength in transportation. We will mainly focus on the following 10 aspects. First, we will speed up modern transport infrastructure projects' construction and optimize their layout, structure, function and system integration. Second, we will advance service quality to achieve easier movement of people and a smooth flow of goods. Third, we will boost the integration of urban and rural transport to better serve rural revitalization and coordinated regional development. Fourth, we will highlight an innovation-driven approach and promote digitalization, intellectualization and V2X (vehicle-to-everything). Fifth, we will deepen green and low-carbon transformation, adjust its structure and develop clean transport. Sixth, we will stress safety in production, strengthen industry supervision, and guarantee security in key fields. Seventh, we will expand transport opening-up and cooperation, and facilitate its connectivity, to push forward global transport cooperation and the high-quality development of the BRI. Eighth, we will improve talent training and management. Ninth, we will enhance management capability, optimize laws and regulations, and strengthen comprehensive regulation to build a unified and open transport market and improve its business environment. Tenth, we will strengthen the Party's leadership and building in the transportation sector.

We will follow the guidance of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era and earnestly implement the guiding principles of the 20th CPC National Congress and the important instructions of General Secretary Xi Jinping on the transportation sector. We will forge ahead in building China's strength in transportation at a faster pace, let the transportation sector be a pioneer in China's modernization drive, and make new and greater contributions to the building of a modern socialist country. Thank you.

Nanfang Daily:

This year's Spring Festival travel rush was the first since China optimized its COVID-19 prevention and control measures. What was the overall performance of the transportation sector? What supporting measures did the 2023 Spring Festival Transportation Special Group take during the travel rush? Thank you.

Li Xiaopeng:

Thanks for your questions. As you said, this year's Spring Festival travel rush was the first of its kind since China's COVID-19 response entered a new stage, making it the most uncertain, complicated and challenging one in recent years. The CPC Central Committee and the State Council attached great importance to it. On Jan. 18, General Secretary Xi Jinping extended festive greetings to all Chinese people when he held nationwide virtual talks with the general public. He underscored the importance of Spring Festival travel to people's immediate interests, economic development, and social stability and made clear requests to ensure safe and sound trips during the travel rush. 

The MOT and relevant departments resolutely implemented the important instructions of General Secretary Xi Jinping, as well as the decisions and deployments of the CPC Central Committee and the State Council. A special group for the Spring Festival travel rush was set up, led by the MOT, and involved 16 ministries and units. We utilized our maximum capacity and provided our best services to coordinate epidemic prevention and control with transportation services. We also created a safe, healthy, convenient, and comfortable transportation experience for people and ensured the smooth delivery of all sorts of key materials.

This year's Spring Festival travel rush generally had the following features. First, the movement of people increased substantially. There was a sharp recovery in passenger traffic as people returned to their hometowns for family reunions, visited relatives and friends, enjoyed tourism and holidays, and traveled for business. According to incomplete statistics, passenger trips exceeded 4.7 billion, an increase of nearly 30% over 2022, the highest number for the Spring Festival travel rush since 2020. The CPC Central Committee's major judgment on the epidemic situation, major decisions on the prevention and control work, and major adjustments in prevention and control strategies have proven completely correct. The policy was successfully implemented, recognized by the people, and enormously effective. China's traffic volume hit 4.7 billion trips over 40 days, reflecting the country's mobile, developing, vibrant and hopeful nature.

Second, self-driving trips reached a record high. Amid the 40-day travel rush this year, there were about 1.184 billion vehicle trips on expressways, carrying more than 3.1 billion passengers. The daily average number of passenger cars reached 29.6 million, with the single-day tally exceeding 60 million on the sixth day of the first lunar month. The share of vehicle trips in the total transfer of personnel jumped to 66% from 47% in 2019.

Third, trips via public transport recovered significantly. It reached about 1.6 billion during the 40-day travel rush this year, an increase of more than 50% over 2022, resuming to about 50% of the level in 2019.

Fourth, transport and logistics functioned smoothly and orderly. During the 40-day Spring Festival travel rush, the transportation of key materials was maintained relatively smooth, meeting the demands of material transportation in medical treatment, energy, food, production and living, spring plowing and other fields.

Fifth, epidemic prevention and control policies were steadily implemented. The epidemic response measures during the travel rush were specified and carefully carried out. Working staff strictly implemented protection and control measures, while the public actively cooperated with them to ensure their individual health protection. Therefore, cross-infection was prevented to the maximum extent and the health of passengers and staff was guaranteed during the large-scale flow of people and logistics.

This year's Spring Festival travel rush ended successfully, with people's satisfaction and sense of fulfillment being significantly enhanced. We mainly adopted the following three measures. First, we took stronger steps to ensure safety of transportation. We carried out actions to identify and address safety hazards in key areas, strengthened our ability to cope with severe weather, and made efforts to raise people's awareness of safe travel. All these efforts have resulted in generally stable and safe transportation during the travel rush. Second, we carried out epidemic prevention and control in a targeted and well-planned manner. We put in place specified prevention and control measures for transport stations and vehicles, strengthened the protection of working staff, and implemented measures designed for combating Class B infectious diseases. Third, we enhanced the organization and arrangement of traffic capacity. In terms of transportation capacity, we strengthened the analysis, organization and arrangement in key areas at key periods to tap the potential and meet the demands of passengers. Regarding the expressway network, we enhanced monitoring and ensured smooth transport. In terms of smooth transportation and logistics, we prioritized unimpeded traffic by consolidating our work in coordination and dispatch. We maintained steady operations during the Spring Festival travel rush through these efforts. In particular, we must point out that all localities and government departments attached great importance to the travel rush. Chief officials in some provinces, autonomous regions and municipalities directly guided the work and some even personally traveled to the stations for inspections or traffic arrangement. With the concerted efforts of the Spring Festival travel rush task force, and the cooperation from railways, highways, waterways, civil aviation, the postal service, and various transport fields, as well as officials and workers at grass-roots levels, who dedicated themselves to the work, the smooth Spring Festival travel rush was guaranteed.

I would like to take this opportunity to express my heartfelt appreciation and sincere greetings to officials and workers from all departments and localities, as well as those frontline workers for their hard work and dedication, and to the public for their understanding and support. In particular, I should mention that media workers played an important role in reporting the Spring Festival travel rush in a dynamic and much deeper way. I would like to express my heartfelt thanks to them. Of course, we are well aware that there is still room for us to improve our work relating to the Spring Festival travel rush since it is very important and the requirements of the people are still high. In the future, we will make persistent efforts and continue to do better work for the Spring Festival travel rush and better meet the needs of the people. We also need your help and supervision in this respect, as well as good opinions and suggestions. Thanks.

Cover News:

As we know, transport and logistics are connected to production on one end and consumption on the other end. What has been the overall situation of the work to ensure smooth logistics since April last year? What measures will be taken next to accelerate efforts to foster a new development pattern? Thanks.

Li Xiaopeng:

Thank you for your question about keeping logistics services smooth. You are correct in stating transportation and logistics connect both production and consumption. It is an important foundation for safeguarding the normal order of people's life and production, promoting the stability of industrial and supply chains, and supporting economic and social reform, development and stability. The CPC Central Committee and the State Council have attached great importance to the work on maintaining smooth transportation and logistics. General Secretary Xi Jinping has made important instructions to ensure smooth transportation and logistics. The MOT has conscientiously implemented the instructions of General Secretary Xi Jinping and, in accordance with the decisions and deployments of the CPC Central Committee and the State Council, set up the leading group for ensuring smooth logistics together with relevant departments. All localities have also established working mechanisms led by local authorities to ensure smooth logistics, strengthen overall planning and management, closely link supply with demand, and provide follow-up services. We have carried out a series of measures such as on-duty shifts, one-to-one coordination, and dealing with cases without delays. With joint efforts, we have achieved phased results in ensuring smooth transportation and logistics.

First, we have maintained the smooth flow on major arterial roads and ensured the unimpeded microcirculation in transportation. The expressway toll stations and service areas that were temporarily closed have all been opened. Epidemic prevention checkpoints temporarily set up on roads, waterways and locks in various localities were all closed. Meanwhile, delivery distribution centers and outlets above the county level that had been shut down nationwide have all resumed services. Stations, airports, ports, and docks are operating normally.

Second, transportation and logistics operations have returned to normal. In 2022, the country's total commercial freight volume increased by 8.2% over 2019. During the Spring Festival travel rush this year, the average daily freight volume of railways, the average daily freight flow of expressways, and the average daily cargo throughput of monitored ports all increased by more than 20% over 2019. The average number of flights confirmed by civil aviation each day returned to about 80% of that in 2019. Average daily postal delivery services increased by 159.4% compared with 2019. These figures fully demonstrate that transportation and logistics operations have returned to normal.

Third, we have maintained the smooth and orderly transportation of key goods and materials. We have strengthened cooperation with key enterprises to ensure supplies regarding energy, food, people's livelihoods, foreign trade, agricultural materials and machines, medical equipment and other key goods, providing strong support for the smooth operation of the economy and society.

Such achievements could not be made without the strong leadership of the CPC Central Committee and the State Council, the joint efforts of all member units of the leading group, and the working mechanisms of all localities. Moreover, they are attributed to the commitment and dedication of the frontline staff. Especially, media outlets including CCTV, Xinhua News Agency and People's Daily have taken the initiative to follow up our work and continuously cover related news, which has played an important role in guiding social expectations and creating a good atmosphere.

Although we have made some achievements, the situation we face in both domestic and international logistics is still severe and complicated. In the next step, we will implement the important instructions of the general secretary and fully leverage the role of the State Council's leading group for ensuring smooth logistics and its office to help build new development patterns, consolidate existing outcomes, mobilize forces in all areas, and ensure smooth transportation and logistics.

First, we need to maintain a smooth transportation network. It is necessary to have a 24-hour on-duty mechanism to strengthen the supervision of case transfer and coordination, arrange key logistics channels in time, and prevent prolonged, large-scale disruption and suspension of services.

Second, it is necessary to ensure the transportation of important goods. We need to better link supply with demand, strengthen overall planning and management, and improve emergency transportation capacity and emergency plans to safeguard the efficient and smooth transportation of key goods and promote unimpeded economic circulation. In particular, we should focus on energy, food, medical supplies and key livelihood supplies.

Third, it is necessary to safeguard smooth operation. We need to strengthen dispatching and operation monitoring, analyze problems in time, and ensure the safety and stability of transportation and logistics.

Fourth, maintaining smooth operation at the end of the logistics process is also essential. We need to improve the service network of the end distribution of urban and rural logistics, make every effort to open the last mile of goods transportation between urban and rural areas, facilitate economic circulation between urban and rural areas, and ensure production and people's regular lives.

Fifth, we need to safeguard international logistics. To ensure the smooth flow of international logistics supply chains, we should foster modern logistics enterprises with international competitiveness and strive to build an open, safe and reliable international logistics supply chain that is shared by the whole world.

All in all, under the leadership of the CPC Central Committee and the State Council, we will continue our efforts to ensure smooth transportation and logistics and provide strong support for economic circulation and development. Thank you.

Southern Metropolis Daily:

In the past three years, during the epidemic, the transportation industry faced many difficulties. What has the MOT done to help related enterprises tide over difficulties? Will there be any follow-up policies this year? Thank you.

Li Xiaopeng:

We will invite Mr. Xu Chengguang to take your questions.

Xu Chengguang:

Thank you for your questions. Transport and logistics are the lifeline of the market economy and an important guarantee for people's livelihoods. In 2022, due to multiple factors caused by the epidemic, transportation entities encountered considerable difficulties in their production and operations. The CPC Central Committee and the State Council attached great importance to that and offered key measures and assistance to them. The MOT thoroughly studied and implemented the guiding principles of the 20th CPC National Congress, and acted in accordance with the requirements of "preventing the epidemic, stabilizing the economy, and ensuring safe development." We implemented a package of policies and follow-up policies to stabilize the economy, worked with relevant departments to refine policies and measures, and increased support for enterprises affected by the epidemic. With focus on stabilizing transportation entities, we made our own contribution to maintaining a stable economic market, and keeping the economy operating within a reasonable range. Our work was mainly as follows.

First, we have strengthened policy supply and leveraged the integrated effects of policies. We have introduced policies to reduce and combine port fees, reduced coastal port navigation fees, improved tugboat fee policies, and reduced cargo dues for a set period. We have also guided all localities to comprehensively promote differentiated toll collection on expressways, strictly implemented the green channel policy for fresh agricultural products, and exempted 10% of toll fees for road freight on toll roads in the fourth quarter. These policy measures have reduced and exempted approximately 96.6 billion yuan. We have also established a special re-lending scheme for transportation and logistics in cooperation with the People's Bank of China and cooperated with relevant departments to launch over 40 relief policies such as tax reduction and fee reduction measures, deferred payments of social security fees, financial subsidies, and credit support. These policies are highly targeted, widely beneficial, and have significant integrated effects.

Second, we took multiple measures to ensure relief policies were fully utilized. We guided transportation departments in all localities to establish and improve working mechanisms, formulate detailed rules for implementation, and promote the full implementation of relief policies. We conducted comprehensive and special inspections and worked to ensure all levels of transportation authorities fulfill their management responsibilities. We dynamically published a list of support policies, strengthened policy publicity and interpretation, and helped market entities fully understand and benefit from the policies. We also strengthened the connection between the government, banks, and enterprises and enhanced interdepartmental information sharing to facilitate the maximum effectiveness of relief policies. This year, our ministry, together with the People's Bank of China and the China Banking and Insurance Regulatory Commission (CBIRC), issued a notice on further improving financial support and services in the transportation and logistics field, extending the transportation re-relending policy to the end of June 2023, expanding the policy support scope, simplifying application conditions, and shortening the reimbursement time.

Third, we have strengthened operation monitoring to ensure that the dividends of policies are fully released. We intensified monitoring over the economic operation of the industry and the business operations of enterprises and tracked the implementation of policies. We established and improved linkage mechanisms with departments such as those overseeing fiscal, taxation, and financial affairs and coordinated and solved problems in policy implementation. According to statistics, in 2022, the tax and fee burden on every 100 yuan of operating income in the transportation industry decreased by 15.4%. The transportation and logistics re-lending policy, the policy to allow deferred repayment of principal and interest for truck loans by central SOEs in the auto sector and financial institutions, and other policies have been implemented and taken effect, effectively reducing the burden on enterprises and practitioners and helping transportation and logistics market entities develop steadily and healthily.

In 2023, the MOT will thoroughly study and implement the spirit of the 20th CPC National Congress and the spirit of the Central Economic Work Conference, conscientiously implement the decisions and arrangements of the CPC Central Committee and the State Council, guide the industry to make full use of various relief policies, continue to optimize the business environment, stimulate the vitality of market players, and better serve economic and social development. Thank you.

Li Xiaopeng:

Just now, Vice Minister Xu answered in detail the question regarding helping enterprises out of difficulties. We sincerely thank the Party Central Committee and the State Council for their great attention to the difficulties encountered by transportation enterprises. We also appreciate the concern and support of friends from all walks of life, including the media, for transportation enterprises facing difficulties. In the new year, under the leadership of the Party Central Committee and the State Council, we will continue to do a good job in assisting enterprises in resolving difficulties and achieving better development. Thank you.

CNR:

General Secretary Xi Jinping attaches great importance to the project to ensure rural roads are well built, managed, maintained, and operated. What new progress has been made in this regard? What measures will be taken in the future?

Li Xiaopeng:

Thank you for the questions about the project. It is a project General Secretary Xi Jinping has personally put forward and advanced to improve people's livelihoods, win the people's support, and govern for the people's benefits. Since the 18th CPC National Congress, General Secretary Xi has made important instructions on the project three times, emphasizing that not only should rural roads be built well, but they should also be managed, maintained, and operated well. General Secretary Xi also particularly emphasized that the project has achieved tangible results in recent years, bringing people and wealth to rural areas, especially poor areas, and consolidating the people's support for the Party at the grassroots level. General Secretary Xi's important instructions highlight his deep concern for the people and inject powerful impetus into our work on improving the construction, management, maintenance and operation of rural roads. Bearing in mind General Secretary Xi's important instructions, the Ministry of Transport has continuously promoted the high-quality development of the project. By the end of 2020, all the villages, townships, and towns with the right conditions were accessible by paved road and provided with bus routes, and rural areas are no longer troubled by poor road conditions. This is a feat of historical significance. The implementation of the project has strongly supported and guaranteed the victory of the critical battle against poverty and the completion of the building of a moderately prosperous society in all respects. 

In 2022, we conscientiously implemented the decisions and arrangements of the Party Central Committee and the State Council. Throughout the year, the total fixed-asset investment in rural roads across the country reached 473.3 billion yuan, a year-on-year increase of 15.6%. Over 180,000 kilometers of rural roads were built or renovated, 10,589 dangerous rural bridges were reconstructed, and 135,000 kilometers of rural roads were reinforced to better protect vehicles and passengers under a road safety project. We also implemented 3,859 rural road projects in the form of work-for-relief, creating job opportunities for 78,000 rural laborers. In the field of rural road management and maintenance, approximately 800,000 jobs were created. By the end of 2022, the coverage rate of the road chief scheme for rural road management tasks in counties (cities, districts) had reached 98.7%, with the number of road chiefs totaling 671,000. More than 8,000 integrated routes for passenger, freight and mail transportation were opened. All these efforts have promoted the high-quality development of the project.

Going forward, we will thoroughly implement General Secretary Xi Jinping's important instructions, promote the high-quality development of the project, and accelerate the improvement of a modern rural transportation system, to better serve the overall promotion of rural revitalization and agricultural and rural modernization, and provide strong and effective service guarantees for achieving common prosperity for all. We plan to continue to promote five aspects of work in improving the construction, management, maintenance and operation of rural roads. First, we will conduct another round of rural road construction and renovation work. There are five major projects: upgrading the backbone road network, extending and improving the basic road network, enhancing safety guarantee capabilities, integrating industrial development, and improving service levels. Through these five major projects, we will accelerate the improvement of a convenient, efficient, inclusive, and equitable rural road network system.

Second, we will help rural people find local employment opportunities and increase their income. We all know that rural roads are transport infrastructure, and their construction attracts migrant workers, allowing farmers to get jobs nearby and increase their income. We must make greater efforts to promote jobs instead of giving grants and continuously increase rural road-related job opportunities.

Third, we will strengthen the management and maintenance of rural roads, improve specialization, mechanization and scale, and promote rural roads' digitalization and information management.

Fourth, we will continuously improve the service quality of rural roads. It is necessary to accelerate the construction of a three-tiered rural logistics system at village, township and county levels and further promote the integrated development of passenger, freight, and postal services, that is, the integrated development of rural passenger transport, rural freight transport, and rural express postal services. We will improve the service level by equalizing urban and rural transport access.

Fifth, we will promote the integrated development of rural roads. It is necessary to develop rural roads in tandem with the construction of supporting facilities, industrial parks, tourist attractions, and rural tourism along the way. In addition, it is necessary to vigorously develop the road derivative economy so that better roads can boost local economies, incomes and areas. Thank you.

Red Star News under Chengdu Economic Daily:

Expanding investment in transportation is an important measure to protect people's livelihoods and promote development, and it is also an effective tool to promote the stable growth of investment. What work has the MOT done in the past year to promote investment and steady growth, and what deployments has it made in the first year to fully implement the guiding principles of the 20th CPC National Congress? Thank you.

Li Xiaopeng:

Thank you for your question about investment. Last year, national transportation fixed asset investment reached 3.8 trillion yuan, a year-on-year increase of 6%, contributing to economic development. This year we will maintain a high transportation fixed asset investment level and continue to contribute our share to the economic development. Next, let me give the floor to Mr. Xu Chengguang to elaborate on this question.

Xu Chengguang:

Transport infrastructure has characteristics such as large investment scale, fast implementation, sound, comprehensive benefits, and a solid driving effect. As you said, it is an important measure to protect people's livelihoods and promote development, and it is also one of the important areas for stabilizing growth and expanding employment. In 2022, the MOT will adhere to the general principle of pursuing progress while ensuring stability, fully implement policies for stabilizing the economy and follow-up policies and invest in transport infrastructure in a moderately advanced manner. As Mr. Li Xiaopeng introduced, asset investment exceeded 3.8 trillion yuan, a year-on-year increase of more than 6%, hitting a record high. Among them, the railway network received 710.9 billion yuan of investment in fixed assets, which was the same as the same period last year. The investment in fixed assets of highways was 2.9 trillion yuan, a year-on-year increase of 9.7%. The investment in fixed assets of waterways was 167.9 billion yuan, a year-on-year increase of 10.9%. Investment in fixed assets in civil aviation exceeded 120 billion yuan, which was the same as the same period last year. It was not an easy year in 2022 for fixed asset investment in transportation to maintain a growth rate of more than 6%, keeping major economic indicators and operations within an appropriate range.

Last year, we focused primarily on three aspects of work:

First, we strengthened policy implementation. We formulated and issued policy documents aiming at expanding effective investment in transportation, including National Highway Network Planning and Opinions on Accelerating the Framework Construction of the National Comprehensive Three-dimensional Transportation Network. We also increased project reserves and preliminary work. We worked with the National Development and Reform Commission, the Ministry of Natural Resources and other relevant departments to make great efforts to solve problems such as land use and sea environment assessment for transportation projects, creating a good policy environment for expanding effective investment.

Second, we increased our efforts to promote projects. We focused on networking, supplementing the network, and reinforcing weak links in transportation. We implemented 11 major project packages, such as the National Expressway Major Corridors Connection Project , and accelerated the construction of the first batch of 16 major projects to build a country with a strong transport infrastructure. The spatial layout of the national comprehensive three-dimensional transportation network framework, consisting of six axes, seven corridors, and eight channels, came into shape. Several railways, highways, water transport and civil aviation projects were completed one after another. Regarding railways, we added 5,000 kilometers of operating range, including about 2,000 kilometers of high-speed railways. As for highways, about 70,000 kilometers of new highways were created, including about 8,000 kilometers of new expressways. Meanwhile, we added and improved 92 tonnage berths and approximately 800 kilometers of high-grade inland waterways. In terms of civil aviation, six new certified transport airports were added. Many key transportation projects, such as the Shenzhen-Zhongshan link, Sichuan-Tibet Railway and supporting highway projects, Chengdu-Lanzhou Railway, Pinglu Canal and other major projects of the Western Land-Sea New Corridor, Xiaoyangshan North Operation Area Container Terminal and supporting projects, and Nanning Airport T3 Terminal Area and supporting projects were advanced in an orderly manner. In 15 major cities, the first round of national comprehensive freight hub supplement and strengthening work was carried out, and a new round of rural road construction and renovation was launched. More than 180,000 kilometers of rural roads were rebuilt, representing a year-on-year increase of about 8%. About 13,800 dilapidated and old bridges were renovated, more than 20,000 kilometers of fine-tuning safety facilities were implemented, and more than 5,400 kilometers of disaster prevention and control projects were implemented.

Third, we raised construction funds from multiple sources. We have given full play to the leading role of central funds. In 2022, the central government arranged special funds of more than 340 billion yuan for road and waterway construction. We strived actively for local government special bonds to be used in transportation projects, strengthened cooperation with financial institutions, and gave full play to the role of policy-based development financial instruments and supporting credit financing to support transportation projects. We promoted the public-private partnership (PPP) model, steadily carried out pilot projects for infrastructure real estate investment trusts (REITs), and actively attracted social capital to participate in transportation construction.

This year, we will fully implement the guiding principles of the 20th CPC National Congress, adhering to the general principle of pursuing progress while ensuring stability. We will also actively expand effective investment in transportation and provide strong support for achieving an overall upturn in economic performance. First, we will continue to focus on networking, supplementing the network, strengthening weak links in the transportation chain, and accelerating the construction of key transportation projects. Second, we will strengthen financial and policy guarantees, effectively encouraging investment in the whole society through government investment and policy incentives. Third, we will increase pre-project work and project reserves, continuing to lay a solid foundation for expanding effective investment in transportation. Thank you.

Changjiang Daily:

Transport is the artery of the market economy and provides substantial support for serving and ensuring people's livelihoods. Over the past year, what practical work has the MOT undertaken to improve people's livelihoods and facilitate travel? Thank you.

Li Xiaopeng:

Thanks for your questions on the practical work concerning people's well-being . General Secretary Xi Jinping has pointed out that the people's aspiration for a better life is what we are striving for. In fact, all of our work on transport directly affects people's well-being. Meeting people's expectations is an important goal for us. While doing our work on transportation, we select practical work concerning people's well-being each year and advance the implementation. Since 2015, this work has been carried forward for eight consecutive years. Last year, we put forward 12 pieces of practical work concerning people's well-being, all of which have been completed. In the future, we will continue to work on that. Next, Mr. Xu will give you a detailed introduction.

Xu Chengguang:

Let me elaborate further on that. Mr. Li mentioned that transport is essential to the country's stability and people's well-being; it serves hundreds of millions of people. Our work on transport is related to work in all fields. Over the years, the MOT has upheld the people-centered development philosophy. Since 2015, we have launched a series of practical work concerning people's well-being in the transport sector every year for eight consecutive years and developed a regular working mechanism to ensure that all the practical efforts we launch every year are fully implemented.

Last year, we came up with 12 pieces of practical work concerning people's well-being, all of which were accomplished. For example, to make travel safer in rural areas, we carried out a life protection project for rural highway safety, covering 135,000 kilometers of rural highways and reconstructing 13,800 dilapidated highway bridges. To facilitate the travel of elderly people, we created over 2,700 urban tram and bus routes with services that provide care and respect for the elderly and reconstructed over 9,500 urban tram and bus stops, continuously improving travel services for the convenience of senior citizens. To deal with limited parking availability at expressway service areas for trucks, we added 21,500 parking spaces for trucks at expressway service areas and built more than 400 service centers for drivers. To address the difficulties for crew members of international voyages to change shifts during epidemic prevention and control, we coordinated with multiple parties. We tried to gain their understanding and support. During that period, 170,000 shifts of crew members on international voyages were completed, resolving the problem of being able to embark but not disembark.

In addition, we completed a series of practical projects concerning people's well-being in regard to railways, civil aviation and postal services, providing all-round and multi-dimensional services for people's travel. Regarding railways, we revised the regulations for railway passenger traffic to allow more children to enjoy preferential policies based on the real-name-based ticket system. We prevented and controlled noise pollution on railways, such as the train whistle. Regarding civil aviation, we launched special campaigns to address the temporary cancellation of flights, with the number of flights canceled within 24 hours dropping from 16,000 in June 2022 to 6,000. We accelerated the application of whole-journey luggage tracking and provided whole-journey tracking for 2.317 million pieces of luggage on 67,000 flights. In terms of postal services, we fully implemented projects to roll out express delivery services in rural areas. As a result, 95% of administrative villages now have access to delivery services. Meanwhile, we worked to safeguard the rights and interests of couriers and built over 30,000 service centers for them, such as the "warm bee post house."

In 2023, we will focus on the most pressing, most immediate issues that concern the public the most. We will launch a series of new practical initiatives concerning people's well-being in the transport sector, including the "sunshine rescue" action on expressways, special action to care for truck drivers, a project to improve service capacity at ports, and measures to provide convenient waterway passenger services. With all these efforts, we will heed the public's concerns and strive to fulfill their aspirations. We will try to provide more considerate and heart-warming services for the people and employees in the transport sector, ensure easier movement of people and a smoother flow of goods, and help people feel more satisfied, happier, and more secure. Thank you.

Xing Huina:

Due to time constraints, we will have one last question.

CCTV:

Last year, on the first anniversary of the second United Nations Global Sustainable Transport Conference, the Global Innovation and Knowledge Center for Sustainable Transport was inaugurated. How will the MOT use this center as a platform to promote global transport cooperation? Thank you.

Li Xiaopeng:

Thanks to the reporter from CCTV for the question. General Secretary Xi Jinping attaches great importance to promoting global transport cooperation. On Oct. 14, 2021, he announced that China would set up a Global Innovation and Knowledge Center for Sustainable Transport in his keynote speech at the opening ceremony of the second United Nations Global Sustainable Transport Conference. On Oct. 14 last year, at the first anniversary of the conference, the center was inaugurated. General Secretary Xi Jinping sent a congratulatory letter on the center's establishment. In the congratulatory letter, he pointed out that China was ready to work with other countries to make full use of this platform to promote global transportation cooperation and contribute to advancing the Global Development Initiative, implementing the UN's 2030 Agenda for Sustainable Development, and building a human community with a shared future.

Taking it as a top priority, the MOT has developed the center and implemented all the tasks. Here I announce that with the permission of the State Council, the MOT will hold the Global Forum for Sustainable Transport (2023) in Beijing from Sept. 25 to 26. The center will host the forum. During the forum, the 15th International Exhibition on Transport Technology and Equipment will also be held, and we will announce the establishment of a global coalition for sustainable transport innovations. During Sept. 25 and 26 this year, the forum, the exhibition, and the coalition will be launched together. Let me brief you on these events.

First, the forum will last for two days and will be held online and offline. The theme is "Sustainable Transport: working together to contribute to global development." The forum will focus on five topics based on the important "five principles" put forward by General Secretary Xi Jinping to advance global transport cooperation. It will host one plenary session, four themed meetings, one ministerial roundtable discussion, and relevant supporting events. Moreover, guests both at home and abroad will be invited. We aim to build a high-level official platform to advance global transport cooperation and contribute to implementing the Global Development Initiative.

Second, the 15th International Exhibition on Transport Technology and Equipment will take "innovation-driven development of global transport" as its theme. It will focus on new technologies, breakthroughs and achievements in areas including intelligent upgrades to transport infrastructure, research and the development of new transport equipment and intelligent transport operation and services. It will become a new platform for publicizing and promoting sustainable transport technologies, equipment, standards and experience.

Third, the global coalition for sustainable transport innovations will be jointly established by the center with Chinese and foreign enterprises and organizations. The coalition will include companies and institutions in the transportation, financial and scientific and technological sectors as founding members. The coalition is positioned to be an international and non-profit social organization for industrial purposes and aims to build a multi-level cooperation platform for governments, society and enterprises. The forum and exhibition will invite domestic and foreign government departments and enterprises, and public institutions to participate. Furthermore, we also welcome our friends from the media, especially those of you here today, to join and give coverage of the events. Thank you.

Xing Huina:

Today's briefing is at this moment concluded. Thanks to Mr. Li and Mr. Xu, as well as our friends from the media. Goodbye!

Translated and edited by Zhu Bochen, Wang Qian, Lin Liyao, Ma Yujia, Zhang Tingting, Huang Shan, Yan Xiaoqing, Wang Wei, Zhang Rui, Yuan Fang, Yan Bin, Li Huiru, Xu Kailin, Yang Xi, David Ball, Tom Arnsten, and Jay Birbeck. In case of any discrepancy between the English and Chinese texts, the Chinese version is deemed to prevail.

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Read in Chinese

Speakers:

Mr. Zhang Yuzhuo, chairman of the State-owned Assets Supervision and Administration Commission (SASAC) of the State Council

Mr. Weng Jieming, vice chairman of the SASAC

Mr. Zhao Shitang, vice chairman of the SASAC

Chairperson: 

Mr. Chen Wenjun, director general of the Press Bureau of the State Council Information Office (SCIO) and spokesperson of the SCIO

Date: 

Feb. 23, 2023

Chen Wenjun:

Ladies and gentlemen, good morning. Welcome to this press conference held by the State Council Information Office (SCIO). This is the second briefing in the series "Embarking on the New Journey—A Government Perspective." Today, we have invited Mr. Zhang Yuzhuo, chairman of the State-owned Assets Supervision and Administration Commission (SASAC) of the State Council, to brief you on thoroughly studying and implementing the guiding principles of the 20th National Congress of the Communist Party of China (CPC) and comprehensively promoting the high-quality development of centrally administered state-owned enterprises (SOEs), and take your questions. We also have with us two vice chairmen of the SASAC, Mr. Weng Jieming and Mr. Zhao Shitang. 

Now, I will give the floor to Mr. Zhang Yuzhuo.

Zhang Yuzhuo:

Thank you. Ladies and gentlemen, good morning. It is a great pleasure to meet with friends from the press and introduce the situation of state-owned capital and SOEs.

The CPC Central Committee with Comrade Xi Jinping at its core attaches great importance to the management of state-owned capital and SOEs. The 20th CPC National Congress has drawn up a grand blueprint for advancing the rejuvenation of the Chinese nation on all fronts through a Chinese path to modernization. It has also made significant arrangements for deepening the reforms of state-owned capital and SOEs, in a bid to accelerate the creation of a new development pattern and pursue high-quality development. Recently, General Secretary Xi Jinping published an important article in the Qiushi Journal titled "Several Major Issues in Current Economic Work." The article emphasizes the need to improve the core competitiveness and core functions of SOEs. Additionally, it lays out plans for a new round of actions to deepen SOE reforms, which is also a major deployment made at the Central Economic Work Conference.

SOEs are an important material and political foundation for socialism with Chinese characteristics. The SASAC has a deep understanding of the decisive significance of the establishment of both Comrade Xi Jinping's core position on the Party Central Committee and in the Party as a whole and the guiding role of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, firmly upholds Comrade Xi Jinping's core position on the Party Central Committee and in the Party as a whole, and also upholds the Central Committee's authority and its centralized, unified leadership. We are working unswervingly both to consolidate and develop the public sector and to encourage, support and guide development of the non-public sector, and continue to build up the strength, quality and size of state-owned capital and SOEs. In these ways, we aim to contribute to comprehensively building a modern socialist country.

In the past year, under the strong leadership of the CPC Central Committee with Comrade Xi Jinping at its core, the SASAC and centrally administered SOEs conscientiously implemented the decisions and deployments of the CPC Central Committee and the State Council. Despite facing difficulties, we made efforts to achieve generally stable economic growth while making further progress. The operating revenues of China's centrally administered SOEs reached 39.6 trillion yuan in 2022, an increase of 9.1% year on year, while their total profits increased by 6.2% to 2.6 trillion yuan and tax payments rose by 19.3% to 2.8 trillion yuan. Remarkable achievements have been made in the reform and development of state-owned capital and centrally administered SOEs and in Party building, making important contributions to the development of the Party and the country. However, we also recognize that there is still a gap between what we have done and the expectations of General Secretary Xi Jinping, the Party Central Committee, and the people.

This year marks the first year of thoroughly implementing the guiding principles of the 20th CPC National Congress. The SASAC and centrally administered SOEs will adhere to the guidance of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, fully implement the guiding principles of the 20th CPC National Congress, thoroughly carry out the deployments of the Central Economic Work Conference and the government work report to be deliberated by the National People's Congress, and focus on Party building, value creation, technological self-improvement, deepening reform, optimizing the layout and keeping the bottom line, to solidly promote various tasks. We will actively promote stable growth, stable employment and stable prices, and play a leading role in promoting the overall improvement of economic operation. We will thus make new and more extraordinary contributions toward building a modern socialist country in all aspects.

Next, my colleagues and I will take your questions. Thank you.

Chen Wenjun:

Thank you, Mr. Zhang. The floor is now open for questions. Please identify the media outlet you represent before asking your questions.

CCTV:

The 20th CPC National Congress drew up an ambitious blueprint for building a modern socialist country in all respects and advancing the great rejuvenation of the Chinese nation on all fronts through a Chinese path to modernization. What are the new missions and tasks for SOEs, especially centrally administered SOEs, in the process of modernization through a unique Chinese path?

Zhang Yuzhuo:

Promoting high-quality development is an essential requirement of Chinese modernization. The SASAC and central SOEs will make high-quality development their top priority. So, to summarize, we will focus on "one goal" and "two paths."

"One goal" means we will strengthen, expand, and increase returns on state-owned capital and SOEs. This is in response to the important arrangement made by General Secretary Xi Jinping and the CPC Central Committee on SOEs, including central SOEs, and to the expectations of all the Chinese people for the SASAC and central SOEs. Also, we set the goal considering that SOEs hold an important position and play a key role as the material and political foundations of socialism with Chinese characteristics. In addition, they are an important pillar and source of strength for the Party to count on in governance. 

"Two paths" means that, on the one hand, we need to increase our core competitiveness; on the other hand, we need to strengthen essential functions through optimal distribution and structural adjustments. To improve core competitiveness, there are four keywords on which we need to concentrate. First, technology. We will focus our efforts on sci-tech self-reliance and self-strengthening, establish cradles for original technologies, and improve the capabilities of basic research and application-oriented basic research at a faster pace. We will also tackle problems in core technological research that hinder the country's development, improve the input-output efficiency of research and development (R&D) investment, and constantly make breakthroughs in increasing the efficiency of our innovation system to ensure that enhanced sci-tech capabilities will further strengthen enterprises, industries and the economy. Second, efficiency. We will give better play to the guiding role of assessment based on a target management system of operational indicators, including total profits, debt-to-asset ratio, return on equity, per capita labor productivity, the ratio of R&D spending to revenues, and the ratio of net cash flow to revenues. We will also strengthen lean production management and increase operational efficiency to improve quality effectively and reasonably increase quantity. Third, talent. We will continue cultivating and making good use of talents and actively participate in the country's establishment of highlands and platforms for high-level talent gathering to cultivate greater numbers of master scholars, science strategists, first-class scientists and innovation teams, young scientists, outstanding engineers, master craftsmen, and highly-skilled workers. Fourth, branding. We will strengthen brand management to realize a transformation from "Made in China" to "Created in China," from "Chinese speed" to "Chinese quality," and from "Chinese products" to "Chinese brands."

To strengthen essential functions, we will focus on optimizing distribution and structural adjustments to consolidate the controlling role of the state-owned sector in major industries and key fields vital to national security and comprise the economy's lifeline. We will also intensify efforts to strengthen the development of the innovation capability system and the layout of new strategically emerging industries. We will also increase support for public service systems to give better play to the state-owned sector's leading and strategically supporting role.

Meanwhile, we will uphold the Party's overall leadership and strengthen Party building in enterprises. We will make efforts to advance a new round of SOE reform and strengthen state-owned assets supervision and administration to provide significant political and institutional guarantees for promoting the high-quality development of SOEs and moving faster to help Chinese companies become world-class entities.

Thank you for your question.

zhonghongwang.com:

A key report delivered at the 20th CPC National Congress further stressed that the modern enterprise system with Chinese characteristics should be improved. What achievements has the SASAC made in improving the modern enterprise system with Chinese characteristics in recent years? What is the goal of building the modern enterprise system? Thank you. 

Zhang Yuzhuo:

Thank you. Mr. Weng is responsible for reform affairs, so let's invite him to answer your questions. 

Weng Jieming:

Thank you for your questions. Corporate governance is a common concern of enterprises of all countries. We must accelerate the building of relevant systems based on the realities of both China and enterprises. The CPC's leadership in SOEs is a "major political principle," and this principle must be insisted on, General Secretary Xi Jinping noted at a national meeting on building the role of the Party within SOEs held on Oct. 10, 2016. Reform to establish a modern enterprise system within SOEs should be adhered to as well, Xi said.  These two principles have elevated the modern corporate governance of SOEs with Chinese characteristics to a new height. Centrally administered SOEs have resolutely implemented the two principles in recent years. On the one hand, we uphold and strengthen the Party's overall leadership and keep in the right direction of reforms and development of SOEs. Centrally administered SOEs have incorporated Party building into their provisions, and the secretary of Party committees or leading Party members groups simultaneously serves as chairman of the board. All centrally administered SOEs and 12,600 important subsidiaries have worked out a list of major business management matters for preliminary research and discussion by Party committees or leading Party members groups, which ensures the leading role of Party committees or leading Party members groups in terms of system, organization and procedure. 

On the other hand, we continue to improve the modern enterprise system to effectively promote the efficiency and vitality of SOEs. The status of independent market entities has been strengthened, the reform to convert SOEs into standard companies has been completed in all respects, and the task to relieve enterprises of their obligation to operate social programs is about to be completed. The establishment of boards of directors has been facilitated. Working rules for boards of directors and a series of measures and procedures for recruitment management, remuneration and treatment, and performance support of outside directors have been introduced. The board of directors should be fully established, with a majority of external directors. Important breakthroughs have been made through three institutional reforms. Contractual management for managers of centrally administered SOEs has achieved full coverage of signed contracts. More than 60% of corporate executives are selected through competitions, and medium- and long-term incentives have been expanded and improved, covering 368,000 people in total.

Practice has shown that the modern enterprise system with Chinese characteristics, which is fundamentally characterized by the two principles, meets the requirements of a socialist market economy, is effective and has overall, fundamental and far-reaching significance for SOEs. 

Next, state-owned capital and central SOEs will take the opportunity of a new round of initiatives to deepen and upgrade the reform of SOEs and implement the two principles to better transform the strength of the modern enterprise system with Chinese characteristics into effective governance. First, we will promote the integration of Party leadership into all aspects of corporate governance and classify and dynamically optimize lists of major business management matters for preliminary research and discussion by Party committees or leading Party members groups. Second, we will pay more attention to improving the corporate governance structure. We will strengthen outside director teams by appointing competent board members, ensuring that the board of directors can play a central role in decision-making. We will also implement the mechanism of delegating authority from the board to managers, establish new forms of responsibility systems in operating business, and attract more talent to participate in the governance of SOEs, so that decision-making, governance, and management of enterprises are more in line with the market economy. Third, we will promote entrepreneurship. We will improve training, selection, appointment, assessment and evaluation mechanisms for entrepreneurs of SOEs, and improve material incentives and awards and honors systems. Fourth, we will be more open to strengthening exchanges and mutual learning about corporate governance. We will strengthen exchanges between SOEs and other ownership enterprises regarding equity, operation, governance and human resources to jointly build modern enterprises. 

Thank you. 

21st Century Business Herald:

My question is about restructuring and integration of centrally administered SOEs. In recent years, intense efforts have been made to step up the restructuring and integration of centrally administered SOEs and innovate their forms. Can you introduce the changes of methods in structural adjustments of centrally administered SOEs as well as the features and achievements of the work? Going forward, do you have a preference for reconstructing and rearranging the centrally administered SOEs through professional restructuring or industrial integration? Thank you. 

Zhang Yuzhuo:

Thank you for your interest in restructuring of centrally administered SOEs. I'd like to invite Mr. Weng to answer these questions. 

Weng Jieming:

Thank you for your questions. Market-based strategic restructuring and professional integration is an effective approach to improve the layout and structure of the state-owned sector. Let me give you some data. Since the 18th CPC National Congress, 27 groups of 49 centrally administered SOEs have undergone strategic restructuring and professional integration. A total of 13 centrally administered SOEs have been established by or included under the regulation of the SASAC of the State Council. The number of centrally administered SOEs being monitored was reduced from 116 to 98, which substantially increased the competitiveness, innovative ability, control power, influence and anti-risk capacities of the state-owned economy. 

First, the ability to provide essential energy and resources has been enhanced. For instance, the establishment of enterprises such as China Mineral Resources Group Co. Ltd. and China Rare Earth Group Co. Ltd. has ensured the security of important energy and resources. The reconstruction of Sinochem Group Co. Ltd. and China National Chemical Co. Ltd. as well as the equity cooperation between China Grain Reserves Group Ltd. and COFCO Corporation has guaranteed the national grain supply and the seed industry. 

Second, the efficiency in allocating state-owned assets and resources has been improved. For example, after the inception of China Oil & Gas Piping Network Corporation (PipeChina) , a total of 89,000 kilometers of oil and gas pipelines formerly owned by three major oil and gas enterprises were reorganized, which promoted the social equality of oil and gas piping network infrastructure. Since the establishment of China Tower, the proportion of shared newly built base stations has increased from 14% to over 80%, saving 55,000 mu (3,667 hectares) of land and 176 billion yuan ($25.57 billion) of investment. 

Third, industrial competitiveness has increased. For example, China COSCO Shipping Co. Ltd . integrated from COSCO Group and China Shipping Group topped the world in many aspects including comprehensive shipping capacity and container port throughput. It was also one of the founders of Ocean Alliance , which has extensive influence. The cooperation between Ansteel and Bensteel as well as China Baowu Steel Group 's mergers and acquisitions of Magang (Group) Holding Co., Ltd. , Taiyuan Iron & Steel (Group) , Chongqing Iron & Steel (Group) and Xinyu Iron & Steel (Group) increased the concentration and competitiveness of the industry. Genertec integrated many companies in the machine tool industry and overcame bottlenecks in high-end machine tooling. The integration of resources in sectors like medical care and examination and testing was accelerated. In this way, professional enterprises take charge of specialized businesses, thus enhancing the competitive edge of enterprises. 

Fourth, the layout of emerging industries has been advanced. For example, we established the China Satellite Network Group to enhance development of new telecommunication technologies. The newly founded China Logistics promoted the construction of modern logistics systems. 

Going forward, the SASAC and the centrally administered SOEs will continue focusing on restructuring and integration, and speed up the optimization of layouts and structural adjustment of state-owned assets. We will advance our work by following market-based principles and according to functions and positions of the SOEs. We will focus on building a modernized industrial system as well as the efficient allocation of resources. 

As for your question about the preference for professional integration or industrial integration in our future work, in my view, the two methods are interconnected and reinforce each other, and cannot be separated completely. We will work with both methods so that they can promote each other. On the one hand, we will push forward professional integration of centrally administered SOEs and regional SOEs. By integrating lateral and relevant industries, one enterprise concentrates on one business and each business is run by one enterprise. In doing so, enterprises are more concentrated and we can enhance our intensive management. On the other hand, we will also press ahead with industrial integration. We will promote the development of strategic emerging industries and integrate not only centrally administered SOEs and other SOEs but also enterprises in other fields and under all forms of ownership with market-based equity cooperation. Thus, we will advance the modernization of national industries. Thank you. 

ThePaper.cn: 

Since the 18th CPC National Congress, historic achievements have been made and historic changes have occurred in the cause of the Party and the country. What important contributions have been made by central SOEs? And what roles have they played? Thank you.

Zhang Yuzhuo:

Centrally administered SOEs are the witnesses, participants and contributors to the great changes that have been made in the cause of our Party and country in the new era. The contributions made by centrally administered SOEs can be summarized in the following five aspects:

First, important contributions have been made to the steady growth of our economy. As market and economic entities, SOEs must first shoulder their economic responsibilities and make economic contributions. Over the past 10 years, centrally administered SOEs have followed the approach of high-quality development, vigorously transformed the growth model, and significantly improved the quality and efficiency of development. The benefits brought by economy of scale have reached new heights. Central SOEs' asset value increased from 31.4 trillion yuan in 2012 to 81 trillion yuan by the end of last year. Their operating revenue increased from 22.3 trillion yuan to 39.6 trillion yuan, and their total profits increased from 1.3 trillion yuan to 2.6 trillion yuan. The efficiency of centrally administered SOEs has improved significantly. Their overall labor productivity increased from 382,000 yuan per person to 763,000 yuan per person. The contributions in tax revenue of central SOEs are also prominent. Their cumulative taxes and fees accounted for around one-seventh of the country's tax revenue, and they have transferred 1.21 trillion yuan of state capital to social security funds.

Second, important contributions have been made in industrial structural optimization and upgrading. Most of the centrally administered SOEs are in major industries that are important to the economy and people's livelihoods, and many are industry leaders. Over the past 10 years, centrally administered SOEs have focused on supply-side structural reform, adjusted stock assets, improved the allocation of incremental capital, and optimized the layout and structure, which strongly promoted the upgrading and development of the industrial system. Primary responsibilities and core businesses were highlighted. As Mr. Weng Jieming just mentioned, 49 enterprises in 27 groups were reorganized or merged through market-based approaches, and 13 enterprises were newly established or accepted as central SOEs. At the meantime, 93% of sub-enterprises were engaged in core business, and the proportion of being involved in the fields related to national security, national economy and people's livelihoods surpassed 70%.The influence in key areas of strategic importance was further increased. Meanwhile, the task of reducing backward production capacity was accelerated, and the task of resolving overcapacity in steel and other sectors was completed first. We disposed of 2,041 “zombie enterprises” and solved problems for enterprises in particular difficulty, effectively revitalizing stock assets. The deployment of emerging industries was accelerated. In the past five years, investment in emerging industries of strategic importance has grown at an average annual rate of more than 20%. The development of green and low-carbon industries was vigorously promoted. From 2012 to 2021, comprehensive energy consumption per 10,000 yuan of output value in central SOEs dropped by around 33%, and emissions of sulfur dioxide, nitrogen oxide and other pollutants all fell by more than 50%.

Third, important contributions have been made in building China into a country of innovators. Scientific and technological innovation is important to the destiny of a country. Over the past 10 years, central SOEs have always given top priority to scientific and technological innovation, strengthened policy support for assessment and capital investment, and accelerated efforts to build up China's strategic capacity in science and technology. Investment in research and development was increased. Centrally administered SOEs have invested 6.2 trillion yuan in research and development, which accounted for more than one-third of the nation's total. Last year, the investment in R&D exceeded 1 trillion yuan for the first time. The building of innovation platforms was accelerated. 764 national R&D platforms and 91 national key laboratories were set up. The number of highly skilled personnel continued to increase. Centrally administered SOEs have 1.045 million scientific and technological personnel or full-time equivalent of R&D personnel, accounting for one-fifth of the nation's total, and 231 academicians of the Chinese Academy of Sciences and the Chinese Academy of Engineering, accounting for one-seventh of the nation's total. Fruitful outcomes were achieved in innovation. Breakthroughs in core technologies were made in key areas, such as power grids, communications and energy. A series of major achievements listed in the 20th CPC National Congress report, such as manned spaceflight, lunar and Mars exploration, deep-sea and deep-earth exploration, satellite navigation, nuclear power technology, new energy technology, and large aircraft manufacturing, were all led or participated in by centrally administered SOEs.

Fourth, making important contributions to deepening reform across the board. On the one hand, the reform of state capital and SOEs has been constantly deepened. To develop the socialist market economy, the three-year action plan for the reform of SOEs has been further implemented, the modern enterprise system with distinctive Chinese characteristics has been established and improved, and the reform to convert SOEs into standard companies, relieve them of their obligations to operate social programs and resolve their other longstanding issues has been comprehensively completed. Significant breakthroughs have been made in the reform to develop market-oriented operation mechanisms, so SOEs and the market economy have been better integrated and a group of modern new SOEs have been created. On the other hand, international cooperation has been continually strengthened. Focusing on the high-quality building of the Belt and Road Initiative, international business operations have been expanded. Overseas assets involved have reached 8 trillion yuan, with over 8,000 projects distributed in over 180 countries and regions worldwide.

Fifth, making important contributions to supplying products essential to people's livelihoods and guaranteeing major events. The enterprises practiced the development philosophy of putting people at the center and actively fulfilled social responsibilities. They resolutely implemented poverty alleviation tasks, with investment and introduction of aid funds totaling nearly 100 billion yuan, and helped lifted 248 key counties included in the national plan for poverty alleviation out of poverty, accounting for 42% of the total number of targeted counties assisted by central departments and organizations. They fully participated in disaster relief, playing an important role in the fight against the COVID-19 epidemic and relieving earthquakes, floods and other major disasters. They provided high-standard services to ensure and support major events, such as the 20th CPC National Congress, the 70th anniversary of the founding of the People's Republic of China, the 100th anniversary of the founding of the CPC, and the Beijing Winter Olympics, fully demonstrating the grandeur of the Party and the country.

Moving along a new journey, we will bear in mind the country's most fundamental interests, adhere to and strengthen the Party's comprehensive leadership over SOEs, and resolutely strive to make state capital and SOEs stronger, better and bigger, making greater contributions to the building of a modern socialist country in all respects .

Thank you.

Phoenix TV:

We have noticed that the report to the 20th CPC National Congress emphasized enhancing people's well-being and raising their quality of life. This puts forward new requirements for the social responsibilities of SOEs, especially central SOEs, in the new era. Can you please tell us what kind of social responsibility work central SOEs have done in recent years and how the SASAC will guide central SOEs to better shoulder these social responsibilities in the future? Thank you.

Zhang Yuzhuo:

Thank you. Mr. Zhao Shitang oversees issues related to social responsibilities. Let's invite him to answer the questions.

Zhao Shitang:

Thank you for your questions. SOEs are enterprises of all the people, and the SASAC and central SOEs are committed to meeting the needs of the people for a better life and seeking benefits for the people. In recent years, SOEs have actively fulfilled their social responsibilities to a high standard, helping to ensure and improve people's livelihoods, which has achieved positive results.

First, we have made every effort to ensure the stable supply and pricing of basic products. Currently, central SOEs account for more than 90% of the national oil and gas supply, more than 60% of the power supply, and more than 25% of the coal supply. They have built a large power grid and telecommunications network covering the whole country. In recent years, faced with the tight supply of energy and electricity, central SOEs have made every effort to allocate resources, ensure supply and stabilize prices, and maintained the security of people's electricity, gas and heating supply. Last year, under the conditions of coal-electricity price inversion and enterprise losses, central SOEs responsible for supplying electricity generated electricity at full capacity, with a cumulative power generation of 5.1 trillion kilowatt-hours, supplying 63.1% of national electricity with 54.7% unit capacity of the total. The average daily output of central SOEs in the coal sector was close to 3 million tons, a year-on-year increase of 7.6%. They made profit concessions of over 190 billion yuan in accordance with medium- and long-term agreements. The central SOEs overseeing the power grid have increased their effort to address the power shortfall of a place by utilizing surplus energy of another place, with a total of more than 2,300 cross-regional and cross-provincial support efforts organized, transferring nearly 45 billion kilowatt-hours of electricity to fill the shortfalls and ensure power supply to the maximum. Petroleum and petrochemical central SOEs, on the one hand, have vigorously promoted domestic shale gas exploration and development and offshore gas field construction, producing more than 206 billion cubic meters of natural gas, a year-on-year increase of 6%. On the other hand, under the situation of large increases in import costs, they have strictly implemented relevant national policy requirements to maintain overall price stability. As we all know, last year, the CPI increase rate in China was controlled at 2%, and the PPI increase rate was 4.1%. The relatively stable prices of basic energies such as electricity, oil, and gas played an important role in it. Central SOEs have made necessary and important contributions in this regard.

Second, we have taken the initiative to help small- and medium-sized enterprises (SMEs) solve their difficulties. Last year, SASAC actively implemented the policy package for stabilizing the economy. In May, we introduced 27 measures to help SMEs overcome difficulties and promote coordinated development to benefit the market. We have achieved the goal of "rent exemption as much as possible, rent exemption as soon as possible." Centrally administered SOEs reduced rents by 19.12 billion yuan in 2022, benefiting more than 220,000 tenants. In particular, the four enterprises --China Resources, China Rongtong Asset Management Group, COFCO Group and China Merchants Group-- each reduced rents by more than 1 billion yuan. We have improved service quality while reducing cost, and offered online services and cloud solutions. During the epidemic, power grid enterprises implemented the policy of "non-stop supply in face of arrearages," optimizing services to reduce costs. A total of 17.5 billion yuan was slashed from the price of purchasing electricity through agents. Telecom enterprises have reduced SMEs' network fees, broadband and special line fees by more than 10% since the end of 2021, saving more than 2.2 billion yuan for their clients. We have achieved "loan deferment and interest waiver, and credit data sharing in the financing sector." At the earliest time possible, we formulated and implemented a policy to postpone the principal and interest payment of consumer loans for commercial trucks for six months. Loan repayments of a total of 57 billion yuan were postponed. The State Grid Corporation's financial services app has helped 27,000 SMEs attain low-cost financing of over 90 billion yuan.

Third, we have actively supported poverty alleviation and rural revitalization. We have actively assisted in industries, employment, consumption and intellectual support. Since the 19th CPC National Congress, centrally administered SOEs have offered more than 27 billion yuan in assistance funds for free, dispatched more than 20,000 officials to help, purchased and helped sell more than 36 billion yuan of agricultural products, directly recruited more than 60,000 people, and helped more than 250,000 poor workers find new jobs. As Mr. Zhang Yuzhuo said just now, all 248 counties designated for receiving assistance have been lifted out of poverty, making an important contribution to winning the battle against poverty, promoting all-round rural revitalization and achieving common prosperity.

Fourth, we have taken the lead in promoting green transformation. We have strengthened energy conservation and emissions reduction and actively built a clean, low-carbon new energy system. Since the 18th CPC National Congress, central coal power enterprises' coal consumption has dropped from 319 grams of standard coal per kWh to 298 grams of standard coal. The proportion of clean energy installed capacity to the total has increased from 28% to 45%, and the utilization rate of new energy in power grid enterprises has exceeded 95%. We have actively participated in ecological governance. China Three Gorges Corporation has actively undertaken the task of protecting the Yangtze River. It has invested over 130 billion yuan along the river and has a daily sewage treatment capacity of 10 million tons, benefiting more than 23 million people.

Fifth, we have devoted ourselves to completing urgent, difficult and dangerous tasks. As long as the country has needs and the people have difficulties, centrally administered SOEs will be unswerving and duty-bound. In the fight against COVID-19, centrally administered SOEs in the construction, pharmaceutical, and other industries rushed to help local governments fight the epidemic and made every effort to ensure a stable supply of medicines, vaccines, and other materials. In disaster relief, centrally administered SOEs gave full play to their professional advantages and offered relief during earthquakes and floods immediately. After the Luding earthquake in Sichuan in September last year, centrally administered SOEs provided more than 6,900 rescue personnel, supplied more than 4,000 vehicles, and donated 1.29 billion yuan.

As we have embarked on a new journey in the new era, the SASAC will continuously require SOEs to adhere to the development concept that puts people first, promote the Chinese path to modernization, and accelerate the process that all share the fruits of development. First, we will further ensure supply and stabilize key energy and resource product prices. Second, we will actively accelerate rural revitalization to ensure people's livelihoods. Third, we will encourage the mutual development of industrial chains and ecosystems. Fourth, we will vigorously promote green development and low-carbon development. Thank you.

Zhang Yuzhuo:

I would like to add something to Mr. Zhao's answer to the question raised by the journalist from Phoenix TV. As you have noticed, international energy prices rocketed last year, with natural gas prices in Europe soaring more than 10-fold. I have also worked in the petroleum and gas industry. The amount of natural gas we produce ourselves is limited, around 200 billion cubic meters. Therefore, liquefied natural gas (LNG) needs to be imported in large amounts. And centrally administered SOEs shouldn't sell the imported LNG at higher prices, instead, they should sell it at rather low prices to stabilize energy prices, and that is how we kept prices at a relatively low level last year with the price inflation rate standing 2% for the 10-year period. It's fair to say that centrally administered SOEs have shouldered their social responsibilities. Thank you. 

Economic Information Daily:

As you mentioned, the three-year reform campaign for SOEs has been completed. Could you please elaborate on the milestone achievements accomplished? Did you gain any beneficial experiences and what effective measures did you adopt in the process? What are the consideration and arrangements of the SASAC for the next round of reforms? Thank you. 

Weng Jieming:

Thank you for your questions. The three-year reform campaign for SOEs from 2020 to 2022 is a major project personally planned and deployed by General Secretary Xi Jinping, generating profound significance in the reform history of SOEs. Thanks to the joint efforts of all parties, including the strong support of friends from the media, the main goals of the three-year SOEs' reform campaign have been accomplished and three notable achievements have been made.

First, the modern enterprise system with Chinese characteristics and the state-owned assets supervision system has become more established and achieved notable results. We have firmly adhered to two principles. We have strengthened the Party's leadership in improving corporate governance and completed restructuring SOEs into corporate systems. We have fully established boards of directors in 38,000 SOEs and accelerated building a governance mechanism featuring statutory powers and responsibilities, transparency, coordinated operation, and effective checks and balances. We have adhered to and improved the regulatory system for state assets that focuses on managing capital, giving full play to the advantages of the professional, systematic and law-based supervision system. We have also enhanced centralized and unified supervision and guidance over state assets that are locally operated. The proportion of state assets under unified supervision by provincial and prefecture-level departments of the SASAC reached 98% and 99%, respectively.

Second, we have made noticeable progress in the layout optimization and restructuring of the state owned sector. Over the past three years, seven centrally administered SOEs in four groups and 347 provincial SOEs in 116 groups have carried out strategic restructuring in a market-oriented manner. We added eight new centrally administered SOEs, including China Star Network and China Rare Earth Group, with them being either newly established or newly accepted as central SOEs. We have further promoted professional integration, and state-owned capital has been further concentrated in important industries, dominant enterprises and their main businesses. We have vigorously eliminated backward production capacity and disposed of non-main and non-dominant businesses and inefficient and ineffective assets. With the disposal task fully completed, a total of 306.7 billion yuan of existing assets were put to market-oriented use and the value added reached 23.4 billion yuan. We have removed social functions from SOEs and resolved issues inherited from the past. We have also stepped up efforts to optimize the layout of strategic emerging industries. As Mr. Zhang mentioned, over the past three years, centrally administered SOEs' investment in strategic emerging sectors has grown at an average annual rate of more than 20%, with the operating revenue accounting for more than 35% of the total, realizing the replacement of the old by the new and accelerating the transformation of growth drivers.

Third, improving the vitality and efficiency of SOEs has achieved remarkable results. The three systemic reforms of SOEs, marked by "the promotion and demotion of management personnel, hiring and firing of employees, and salary increase and decrease," have made a breakthrough on a large scale at multiple levels. The proportion of centrally administered SOEs and their local subsidiaries at various levels that carry out a tenure system and contract management has increased from 23.5% and 23.2%, respectively, at the end of 2020 to more than 99% at present. By the end of 2022, 38,000 management personnel of centrally administered SOEs and their subsidiaries at all levels were either reassigned or resigned due to incompetence, accounting for approximately 6.9%. There are 5,750 subsidiaries of centrally administered SOEs that have launched medium- and long-term incentives, accounting for about 94.8% of qualified subsidiaries.

General Secretary Xi Jinping emphasized that if we want SOEs to do well, we must reform them and transform them into modern enterprises . After three years of reform, the group of old SOEs has taken on a new look and unleashed fresh vitality. A group of modern new SOEs have mushroomed, thrived and embarked on a new journey of speeding up the construction of world-class enterprises. Guided by General Secretary Xi Jinping's important instructions on the reform and development of SOEs, we are more confident and determined to further deepen SOE reform and improve SOEs.

There is no end to development, and reform should not stop. The 20th CPC National Congress made specific plan on deepening state-owned capital and SOE reform. General Secretary Xi Jinping personally planned a new round of actions to deepen and upgrade SOE reform. We will firmly implement, adhere to and strengthen Party leadership in all of our work, insist on consolidating the basic socialist economic system, continue reforms to develop the socialist market economy, focus on improving the core competitiveness of SOEs and enhance their core functions, and take advantage of the momentum to carry out the new round of actions to deepen and upgrade SOE reform, which mainly includes the following three aspects.

First, we will move faster to improve the layout and structure of the state-owned sector and enhance its function of serving the national strategy. SOEs, especially centrally administered SOEs, should play a strategic supporting role and their due role in serving the country's overall interests and building a new development pattern. We will promote strategic reorganization and professional integration in a market-oriented manner, make greater efforts to deploy forward-looking strategic emerging industries, promote the digital, intelligent, green transformation and upgrading of traditional industries, improve the resilience and security level of industrial and supply chains, and promote the new type of industrialization and modernize the industrial system.

Second, we will accelerate the improvement of modern corporate governance of SOEs with Chinese characteristics and truly operate according to a market-oriented mechanism. We will consolidate the achievements of the SOE reform over the past three years and dynamically optimize the list of the pre-research items of different types at different levels concerning major business management for the Party Committee or CPC leadership group of SOEs. We will improve the quality and performance of external directors and the modern enterprise system with Chinese characteristics. We will continue to deepen the three systemic reforms and improve the level of modern management. Therefore, we are taking relevant actions to build world-class SOEs in an all-round way.

Third, we will speed up the improvement of systems and mechanisms that are conducive to the scientific and technological innovation of SOEs and accelerate the creation of innovative SOEs. Efforts should be made to solve prominent problems such as mechanisms, investment, talents, and application that restrict corporate scientific and technological innovation, improve the incentive and restraint mechanism and the talent training system, further reinforce the principal position of enterprises in innovation, and jointly build a good innovation ecology, so as to truly fulfill the role of the national team of scientific and technological innovation.

Thank you.

Hong Kong Economic Herald:

My question is about the Belt and Road Initiative (BRI). The report to the 20th CPC National Congress spoke highly of the joint construction of the BRI over the past 10 years. BRI cooperation has become a popular platform for international cooperation. This year marks the 10th anniversary of the BRI. What achievements have central government enterprises made in the Belt and Road cooperation? Regarding implementing the guiding principles of the 20th CPC National Congress, what measures and actions will be taken to promote the Belt and Road cooperation in the next stage? Thank you.

Zhao Shitang:

Thank you for your questions. As you mentioned in your questions, centrally-administered SOEs have proactively integrated themselves into China's all-round opening up over the decade since the launch of the Belt and Road Initiative. They have made great efforts to overcome risks and challenges such as the COVID-19 pandemic, profound changes unseen in a century, and downward pressure on the economy. They have achieved positive outcomes in promoting the high-quality Belt and Road cooperation, which can mainly be demonstrated in the following three aspects.

First, centrally-administered SOEs have focused on constructing infrastructure and industrial parks and have integrated themselves into and promoted the development of the local economy. Over the past decade, centrally-administered SOEs have undertaken over 200 major infrastructure projects abroad, including ports, railways and airports. In the field of transportation, General Secretary Xi Jinping witnessed the successful trial operation of the Jakarta-Bandung High-speed Railway during the G20 summit. The China-Laos Railway has assisted Laos in transforming itself from a landlocked to a land-linked hub. The Piraeus port in Greece has become a gateway to the land-sea transport route in the Mediterranean region. In the field of communications, three major telecommunication operators have provided overseas service networks to over 40 countries. In energy, centrally-administered SOEs have undertaken about 300 projects, including hydropower, wind power, and photovoltaic projects. They have completed signature projects such as the Karot Hydropower Plant in Pakistan and the Belo Monte ultra-high voltage power transmission project in Brazil, advancing the green transition of energy and low-carbon development in host countries. They have constructed and operate over 20 industrial parks abroad, such as the China-Belarus Industrial Park, helping these countries to build a platform for international industrial-capacity cooperation. At present, the China-Belarus Industrial Park hosts more than 100 enterprises. 

Second, centrally-administered SOEs have fulfilled their social responsibilities and taken proactive steps to improve local people's lives. The overseas agencies of centrally-administered SOEs have directly created nearly a million jobs for local people and several times more indirect jobs. When implementing the Djibouti Port and Hambantota Port projects, they carried out the "Blue Ocean" training program, cultivating many port management professionals. The Cabinda water supply system project in Angola enabled 600,000 local people to access clean tap water. The China-assisted project of the Africa Centers for Disease Control and Prevention headquarters has been put into use, effectively improving disease prevention, control, and monitoring and epidemic response and emergency speed. 

Third, centrally-administered SOEs have followed international rules and standards and provided high-quality products and services to benefit the world. They have actively formulated international standards in areas such as ultra-high voltage and 5G communications. Meanwhile, they have taken the lead in establishing over 100 international standards for electricity. High-speed railways, ultra-high voltage power transmission technology, the new generation of mobile communications and Hualong One nuclear power technology, have gone overseas, enabling people along the Belt and Road to enjoy high-quality products and services. 

Next, centrally-administered SOEs will keep acting on market-oriented, law-based and international principles. They will build and operate a batch of major projects focusing on green, healthy and digital development areas to a high standard, such as the Jakarta-Bandung High-speed Railway, and develop a series of "small and beautiful" projects with sound economic and social benefits. With all these efforts, they will promote Belt and Road cooperation to deliver more solid outcomes. Thank you.

Thecover.cn:

According to the report to the 20th CPC National Congress, we should speed up efforts to achieve greater self-reliance and strength in science and technology. In this regard, what achievements have been made by SOEs as the major force in scientific and technological innovation? What will be done next to further reinforce the principal role of enterprises in innovation to assist China in achieving greater self-reliance and strength in science and technology? Thank you.

Zhang Yuzhuo:

Thank you for your questions. Regarding the scientific and technological innovation of centrally-administered SOEs, I believe the past work can be generalized into two aspects. One is that glorious achievements have been made. And the other is that much remains to be done.

In terms of glorious achievements, major scientific and technological advances have been made over previous years in the following aspects. First, SOEs have made original innovations in basic and frontier sectors, including manned spaceflight, thermonuclear, the Beidou Navigation System, deep-water exploration, and the Five-hundred-meter Aperture Spherical Radio Telescope (FAST), which are all world-class original innovations. Second, a scientific and technological growth driver has been injected into building a modernized economy. A chain of innovation has been shaped to match the overall industrial chain. Core technologies in key fields have been adopted to steer manufacturing toward the medium- and high-end. China has taken the lead in applying 5G technology on a larger scale. One of the major advances last year was that the high-speed maglev train, with a designed top speed of 600 km per hour, rolled off the production line. In terms of high-end materials, a 10,000-ton-level 48K large-tow carbon fiber was put into production. The large passenger aircraft C919 was delivered. They also released a batch of other high-performance equipment. All these developments have advanced the transition from "made in China" to "created by China." Third, strong support has been provided for safeguarding science and technology security and energy security. Focusing on priority areas of strategic importance, SOEs have promoted the development of technologies in urgent need and those hindering the country's development. They have filled up a batch of gaps in science and technology. Major achievements have been made in high-temperature gas-cooled reactor demonstration projects, the Deep Sea No.1 oil production and storage facility, and the F-class 50 MW heavy-duty gas turbine. Fourth, a solid basis gives guarantee for people to enjoy the latest scientific and technological advances. Efforts have been sped up to promote breakthroughs in the fields of the seed industry and high-end medical equipment. In the fight against COVID-19, starting from scratch, SOEs developed mask machines, plodder machines and other equipment in urgent need and made an all-out effort to develop and supply testing kits and vaccines. These are all glorious achievements that have been made.

On the other hand, there is still a long way to go. Regarding science and technology, there is still a noticeable gap between China and other countries with advanced scientific and technological strengths. Central SOEs continue to have significant potential for solving core technical difficulties. Technology determines the future of businesses, and the businesses of the future. Looking ahead, we will accurately grasp the strategic position of central SOEs in China's overall sci-tech innovation, strengthen advantages, shore up weak links, keep up with the frontiers, enhance enterprises' dominant position in sci-tech innovation, and strive to create innovative SOEs.

We will focus on three areas. First, we will continue to make new breakthroughs in core technologies. We will develop a source of original technologies and promote high-quality breakthroughs in core technologies. We will increase technical investment in traditional manufacturing upgrading and strategic emerging industries, as well as in key areas such as integrated circuits and industrial machine tools, and improve our capacity for basic research and applied basic research. Second, we will secure new breakthroughs in improving the input-output efficiency of sci-tech research and development. We will further optimize the input structure and prioritize sci-tech output, achievements, applications, and the industry. We will establish a results-oriented sci-tech innovation work system, improve the mechanism for the commercialization and application of sci-tech advances, accelerate technological iteration and upgrading, and develop a more effective mechanism for sharing the benefits of sci-tech achievements so that sci-tech advances can be applied and researchers can be rewarded. Third, we will continuously make new breakthroughs in enhancing the efficacy of the innovation system. We will participate in national decision-making on sci-tech innovation in a broader and deeper manner, strengthen the driving force of major projects, make good use of platforms such as national laboratories and innovation consortiums, support qualified enterprises in integrating and transforming into research institutes and application-oriented research institutes, establish industrial research institutes, and lead the deep integration of industry, academia and research.

Thank you.

Chen Wenjun:

Due to the time limit, this will be the last question.

People's Daily:

As we know, since the national meeting on building the role of the Party within SOEs was held, the Party's leadership in central SOEs has been continuously consolidated, and Party building has also been strengthened. What major progress has been made in this regard, and what are the main plans for the work going forward? Thank you.

Zhang Yuzhuo:

Thank you. On Oct. 10, 2016, General Secretary Xi Jinping attended the national meeting on Party building in SOEs and delivered an important speech. Over the past seven years, guided by the principles of General Secretary Xi Jinping's important speech, the SASAC and central SOEs have comprehensively strengthened Party building in SOEs, sincerely fulfilled their responsibilities to exercise full and rigorous governance over the Party at various levels, and fundamentally improved the political ecology of enterprises. The SASAC and central SOEs have undergone transformative changes related to function orientation, development philosophy, development mode, and work focus. Everyone has attached more importance to the Party's leadership in SOEs, as Party leadership in SOEs can be traced back to China's Constitution. Article 1 of the General Principles of the Constitution stipulates that the leadership of the Communist Party of China is the defining feature of socialism with Chinese characteristics, so it is necessary to strengthen the Party's leadership in SOEs. Specifically, achievements have been made in six respects. First, more firm and conscious efforts have been made to uphold Comrade Xi Jinping's core position on the Party Central Committee and in the Party as a whole, as well as uphold the Central Committee's authority and its centralized, unified leadership. Second, the Party's overall leadership over SOEs has been organized, institutionalized and concretized. Third, a group of politically strong and highly competent enterprise leaders has been cultivated. Fourth, the foundation for Party building at the grassroots level has been thoroughly consolidated. Fifth, the publicity and ideological work under a new situation have been strengthened. Sixth, further efforts have been made to exercise full and rigorous governance over the Party.

The practice has proved that upholding the Party's leadership and strengthening Party building is a proud tradition, the "root" and "soul," and a unique strength of SOEs. The 20th CPC National Congress made major arrangements to advance full and rigorous Party self-governance unswervingly. SOEs should highlight one theme and focus on five key points. The one theme is to let high-quality Party building lead and guarantee the high-quality development of central SOEs, and strive to establish a Party building pattern in the SASAC and central SOEs that matches the system of exercising full and rigorous Party self-governance, coordinates with the modern enterprise system with Chinese characteristics, and accords with the central reform and development tasks of enterprises, so as to provide a political guarantee for developing world-class enterprises at a faster pace. The five key points are to strengthen organization, team building, the exercise of full and rigorous Party self-governance, responsibility, and the publicity and ideological work. Thank you.

Chen Wenjun:

Thanks to Mr. Zhang, Mr. Weng and Mr. Zhao, as well as friends from the media. Today's briefing is hereby concluded. Goodbye. 

Translated and edited by Wang Yiming, Wang Wei, Li Xiao, Wang Qian, Yang Xi, Zhou Jing, Liu Jianing, Dong Qingpei, Liu Sitong, Zhang Rui, Yuan Fang, Xiang Bin, Zhang Junmian, Qin Qi, Yan Bin, Huang Shan, Xu Kailin, Wang Yanfang, Xu Xiaoxuan, Li Huiru, David Ball, Tom Arnsten, and Jay Birbeck. In case of any discrepancy between the English and Chinese texts, the Chinese version is deemed to prevail.

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Read in Chinese

Speakers:

Mr. Tang Renjian, director of the Office of the Leading Group for Rural Affairs of the CPC Central Committee, and minister of agriculture and rural affairs

Mr. Liu Huanxin, deputy director of the Office of the Leading Group for Rural Affairs of the CPC Central Committee, member of the CPC Leadership Group of the Ministry of Agriculture and Rural Affairs, and administrator of the National Rural Revitalization Administration

Mr. Wu Hongyao, deputy director of the Office of the Leading Group for Rural Affairs of the CPC Central Committee, and member of the CPC Leadership Group of the Ministry of Agriculture and Rural Affairs

Chairperson: 

Mr. Chen Wenjun, director general of the Press Bureau of the State Council Information Office (SCIO) and spokesperson of the SCIO

Date: 

Feb. 14, 2023

Chen Wenjun:

Ladies and gentlemen, good morning. Welcome to this press conference held by the State Council Information Office (SCIO). 2023 marks the first year of implementing the guiding principles of the 20th National Congress of the Communist Party of China (CPC). We will hold a series of themed press conferences, inviting leaders of relevant departments to introduce the ideas, measures, progress and achievements in implementing the guiding principles of the congress. We named the series “Embarking on the New Journey—A Government Perspective,” and we welcome your attention. Today, we are holding the first press conference in the series, to introduce and interpret the newly unveiled the "No. 1 central document" for 2023 as well as answer your questions. Present at the press conference are: Mr. Tang Renjian, director of the Office of the Leading Group for Rural Affairs of the CPC Central Committee, and minister of agriculture and rural affairs; Mr. Liu Huanxin, deputy director of the Office of the Leading Group for Rural Affairs of the CPC Central Committee, member of the CPC Leadership Group of the Ministry of Agriculture and Rural Affairs, and administrator of the National Rural Revitalization Administration; and Mr. Wu Hongyao, deputy director of the Office of the Leading Group for Rural Affairs of the CPC Central Committee, and member of the CPC Leadership Group of the Ministry of Agriculture and Rural Affairs.

Now, I will give the floor to Mr. Tang Renjian.

Tang Renjian:

Ladies and gentlemen, good morning. With the arrival of spring, farmers are once again busy with work. On Feb. 13, Xinhua News Agency was authorized to issue the "Opinions of the Central Committee of the Communist Party of China and the State Council on Comprehensively Promoting the Key Work of Rural Revitalization in 2023," or the No. 1 central document for 2023. This is the 20th consecutive No. 1 central document released by China's central authorities to guide the work on agriculture, rural areas and rural residents since the beginning of this century. Through the document, the CPC Central Committee reiterated its commitment to the work on agriculture, rural areas and rural residents, sending a strong signal of prioritizing and boosting agriculture. Now, I would like to briefly introduce the document.

First, the background in drafting the document. 

Over the past year, under the strong leadership of the CPC Central Committee with Comrade Xi Jinping at its core, we have coordinated the COVID-19 response and agricultural and rural development, effectively addressed multiple challenges, kept the fundamentals of agriculture stable, and consolidated the “ballast” for the work on agriculture, rural areas and rural residents, thus providing a foundation for overall economic and social stability. First, China has secured another bumper harvest. The country's grain output totaled 1.3731 trillion jin (686.55 billion kg) in 2022, up 7.4 billion jin (3.7 billion kg) compared to the previous year and again setting a new high. The increase in the production capacity of soybeans and other oilseed crops exceeded projections. Hog production remained stable. The market supply and prices of meat, eggs, milk, fruit, vegetables and fish were stable throughout the year. Second, the gains in poverty alleviation have been further consolidated. The monitoring and assistance mechanism has been continuously improved, industrial and employment assistance has been strengthened, and the risks of returning to or falling into poverty have been effectively defused. We have maintained the bottom line of ensuring no large-scale return to poverty. Third, the incomes of farmers maintained steady growth. The per capita disposable income of rural residents surpassed the milestone of 20,000 yuan, reaching 20,133 yuan ($2,937), an increase of 4.2% in real terms, 1.2 and 2.3 percentage points higher than the growth rates of GDP and per capita disposable income of urban residents, respectively. Fourth, solid steps have been taken to promote priorities for rural revitalization. The development of rural industries has been boosted, initiatives to improve rural infrastructure have been launched, the level of rural governance has been continuously improved, the reform of rural areas has been advanced, and rural society has been stable and peaceful.

The 20th CPC National Congress drew up a grand blueprint for advancing the rejuvenation of the Chinese nation on all fronts through a Chinese path to modernization, and proposed for the first time moving faster to build up China’s strength in agriculture. At the annual central rural work conference held at the end of last year, General Secretary Xi Jinping, with the overall strategy of national development and rejuvenation in mind, systematically expounded a series of major theoretical and practical issues on moving faster to build up China’s strength in agriculture, promoting the modernization of agriculture and rural areas and advancing rural revitalization across the board, which provided fundamental principles and guidelines for drafting the No. 1 central document for 2023 and delivering a satisfactory performance in the work on agriculture, rural areas and rural residents on the new journey of the new era. General Secretary Xi Jinping emphasized that a country must first strengthen agriculture to make itself strong, and only when agriculture is strong can the country be strong . He noted that the most challenging and arduous tasks we face in building a modern socialist China in all respects remain in our rural areas. He said that addressing the issues related to agriculture, rural areas and rural residents should have a central place in the work agenda of the Party , and we should mobilize efforts and resources across the Party and the society to advance rural revitalization across the board, accelerate the modernization of agriculture and rural areas, move faster to build up China’s strength in agriculture, and build a beautiful and harmonious countryside that is desirable to live and work in, so as to lay a solid foundation for building a modern socialist country in all respects.

Second, the main content of the document.

Implementing the guiding principles from General Secretary Xi Jinping's important speeches and following the arrangements and requirements of the CPC Central Committee and the State Council, the document fully puts the guiding principles of the 20th CPC National Congress into action. It aims to expedite the efforts to build China's strength in agriculture. It focuses on rural revitalization, with eyes both on the present and future, and features conciseness, practicality, and innovation. The document centers closely on the benchmark issues and urgent matters involved in comprehensively promoting rural revitalization and specifies key tasks and policy measures in the field. It consists of nine sections and 33 items, and its main content can be summarized as completing basic tasks, advancing rural revitalization, and strengthening related support.

In terms of completing basic tasks, the document underlines the effort to ensure the nation's food security and that people do not sink back into poverty in large numbers. First, it stresses the need for stable production and adequate supplies of grains and other important agricultural products. It stresses that we must boost the construction of agricultural infrastructure and strengthen support for agricultural science, technology, and equipment, in a bid to ensure that the country's annual grain output remains over 650 million metric tons. Second, the document underscores the tasks of strengthening the internal growth momentum of areas and people that have shaken off poverty, stabilizing and improving supportive policies, and ensuring that people do not sink back into poverty in large numbers.

In terms of advancing rural revitalization, the document centers on the general requirements of this endeavor and stresses efforts to foster rural development, construction, governance and other significant issues. First, it stresses bolstering high-quality rural industries and developing new industries and business forms in rural areas. Second, it emphasizes boosting employment among rural residents and increasing their incomes, enhancing the efficiency of agricultural businesses, giving rural residents greater property rights and interests, and expanding channels for them to gain additional income. Third, in line with rural areas' goal to have basic access to modern lives, the document stresses building a beautiful countryside that people enjoy living and working in. Fourth, it emphasizes improving the rural governance system led by Party organizations and enhancing the efficiency of rural governance.

In terms of strengthening related support, the document stresses reinforcing organization and guidance. It emphasizes strengthening policy guarantees, institutional innovation, and the Party's leadership in all the work concerning agriculture and rural areas and residents.

In general, this year's document focuses on implementation and highlights the guiding role of the arrangements and the targeted nature of policy measures. It is not only a "to-do list" that specifies the priorities of our work this year but also a "handbook" that guides our efforts to comprehensively advance rural revitalization.

Next, my colleagues and I will take your questions.

Chen Wenjun:

Thank you, Mr. Tang. The floor is now open for questions. Please indicate the media organization you work for before raising questions.

CCTV:

At the end of last year, the central rural work conference made arrangements to accelerate the building of strong agriculture. What does it entail and what are the basic requirements of this endeavor? Thank you.

Tang Renjian:

Thank you for your question. This is a crucial issue and comprises the essence of the document. Accelerating the building of strong agriculture is a strategic arrangement made for the work concerning agriculture, rural areas and rural residents in the new era by the CPC Central Committee with Comrade Xi Jinping at its core. It was made to coordinate China's internal and international imperatives and build China into a great modern socialist country in all respects. It clarifies the historical status and future goals of the work concerning agriculture, rural areas, and rural residents in the overall drive of China's national rejuvenation.

Building strong agriculture involves many facets. It involves the growth of productivity and the development of production relations. It also concerns the comprehensive upgrading of agriculture, progress in every sector of rural areas, and the well-rounded development of rural residents. For one thing, China must meet the standard qualifications for strong agriculture. Despite differences in resources, institutional environment, and agricultural capacity, foreign countries with strong, modern agriculture bear common features. We need to follow the general principle of modern agriculture development, find out where we have fallen short, make up for our weaknesses, and leverage our advantages in a bid to build an agricultural sector that is strong in supply, sci-tech equipment, business systems, industrial resilience and overall competitiveness. In addition, Chinese characteristics need to be considered based on our national conditions. Agricultural planting and animal husbandry require an appropriate natural environment, which is crucial for agriculture. Likewise, the endeavor of building strong agriculture also needs to fit our national and agricultural conditions, and we need to rely on ourselves to solve practical problems. This is very important. China has a vast population but limited land resources. Its farming civilization has a long history, but our time demands greater harmony between humanity and nature. These three aspects determine that we must be self-dependent in securing our food supply. To develop agriculture, we must rely on the two-tier management system, which integrates cooperative management with household contract management. We must also advance eco-friendly and low-carbon agriculture, sustain our farming civilization, and promote prosperity for all. These statements reflect China's characteristics as well as its national and agricultural conditions. We need to explore a path of agricultural modernization with distinctive Chinese features.

Building China's strength in agriculture is a long-term task and a systematic project. This requires attention to methods while grasping timing, degree, and effectiveness. First, it is necessary to accurately understand the layout of rural work regarding agriculture, rural areas, and rural residents. Building China's strength in agriculture is in line with advancing rural revitalization across the board, with the same goals and unified processes. Currently, the focus should be on advancing rural revitalization on all fronts, ensuring the connection between policy and work systems, and maintaining work continuity without changing the focus, theme, or channel. Second, it is necessary to strengthen overall planning. We should accelerate the study and formulation of plans to speed up the building of China's strength in agriculture, do a good job of overall planning and systematic arrangements, and connect with existing plans. It should be neither a completely new plan nor disconnected from existing ones, but rather a clear roadmap and a working plan with a solid and effective implementation that is both connected and innovative. We must work out such a plan. Third, it is necessary to highlight practical results and effectiveness. Our work’s emphasis should be on solving the most urgent and pressing issues of local agricultural and rural development, focusing on specific practical issues raised by farmers, including some key small matters, and making sustained efforts. The goal is to make rural people feel a tangible sense of gain, happiness, and security in the process of rural revitalization. Thank you.

Farmers' Daily with Farmer.com.cn:

Ensuring national food security is the top priority of rural work in agriculture, rural areas, and rural residents. What is the current national food security situation in China? In order to ensure national food security, what specific measures will be taken next? Thank you.

Tang Renjian:

Thank you for your questions. Ensuring national food security is the primary task of building China's strength in agriculture. Regarding the situation you asked about, we all know that we faced the intertwined and overlapping challenges of the pandemic and disasters last year. International grain prices fluctuated dramatically, and there was a severe situation caused by the impact of high agricultural material prices. Nevertheless, China's grain production has achieved another harvest, with a stable output of over 1.3 trillion jin (650 million metric tons) for eight consecutive years. We have made the food supply more stable, better, and more secure for more than 1.4 billion Chinese people, which has provided important support for stabilizing expectations, prices, and confidence. However, we must also see that the pressure to keep our rice bowls safe is increasing due to the large population base, the upgrading of consumption, the growth in food demand, and the increasing uncertainty and instability of global agricultural trade. Next, we must take multiple measures and comprehensive actions to strengthen the foundation of food security from all aspects.

In terms of goals, we will focus on stabilizing the grain acreage, increasing the per-unit crop yield, and striving for greater output. First, we must stabilize the grain acreage, which is the foundation of grain production. We will promote multiple cropping in southern provinces, implement projects to increase the per-unit yield of soybeans and corn (because the per-unit yield of both is now relatively low), and ensure that grain output remains above 650 million metric tons by carrying out the establishment of farmland with an annual yield of 1000 kg per mu. At the same time, we will intensify efforts to expand the planting of soybean and other oil crops, solidly promote the belt-like compound planting of soybeans and corn, support the rotation of grain and soybeans in Northeast China and the Huang-Huai-Hai region, and steadily develop and utilize saline-alkali land for planting soybeans. Pilot projects in some areas have shown good results, and we have opened up a new resource to expand production and increase output with multiple oil crops. Second, we must increase production capacity. The CPC Central Committee and this year's No. 1 central document have made it clear that we must launch and implement a new round of action to increase grain production capacity by 50 billion kilograms, concentrate necessary resources, and use all means to promote the early attainment of a new level of grain production capacity. Typically, every 50 billion kilograms represents one further level, which means we have to reach over 700 million metric tons (from 650 million metric tons). In addition, we must establish a broad concept of food, formulate plans by sector, accelerate the building of a diversified food supply system, and enrich the sources of food varieties.

In terms of measures, we will focus on strengthening the material foundation for crop production based on farmland management and technological application. One is to strengthen infrastructure construction. We will strictly control the usage of farmland, resolutely ensure the area of farmland remains above the red line of 120 million hectares, complete the annual task of new construction and upgrading of high-standard farmland, and promptly formulate an implementation plan to gradually develop all permanent basic cropland into high-standard cropland. This is a big move, involving 103 million hectares of permanent basic cropland. We will use modern agricultural facilities to better ensure food security. The second is to strengthen the support of scientific and technological equipment. We will promote the breakthrough of key and core agricultural technologies, deeply implement the seed industry revitalization action, build up our strength in agricultural technology at a faster pace, focus on improving per unit crop yield, and come up with comprehensive solutions for integrating good soil, good crop varieties, good methods, good machinery, and good mechanisms for each variety, and rely on science and technology to increase the grain output and capacity.

In terms of policy, the focus is to improve institutional safeguards for farmers to grow grain and make a profit and for local governments to take responsibility for grain production. I just talked about the point of strengthening the material foundation for crop production based on farmland management and technological application. The point I’m talking about now emphasizes the improvement of the institutional assurance for farmers to grow grain and make money and for local governments to take responsibility for grain production. The two points come down to these four words: farmland, technology, profit, and responsibility. The first is policy guidance. We need to improve the income guarantee mechanism for grain growers, continue to raise the minimum purchase price of wheat, reasonably determine the minimum purchase price of rice, stabilize rice subsidies, improve corn and soybean producers' subsidies, increase soybean subsidies, and promote the expansion of policy-based purchase and storage of soybeans and market-based purchases. We will gradually expand the implementation scope of full-cost insurance and planting income insurance for rice, wheat, and corn and improve the mechanism for ensuring the supply and stabilizing the price of agricultural materials. At the same time, it is necessary to improve the interest compensation mechanism for major grain-producing areas and increase the scale of rewards for major grain-producing counties. The second is to ensure fulfillment of responsibilities. This year, we will continue to assign the grain production targets and tasks approved by the State Council to all provinces, autonomous regions and municipalities, and ensure the planting area set for each variety is not compromised. We will strictly assess the performance of provincial Party committees and governments under the accountability system for farmland protection and food security, and promote the implementation of policies and measures through the fulfillment of responsibilities. Thank you.

Global Times:

Consolidating and expanding the achievements in poverty alleviation is a prerequisite for comprehensively promoting rural revitalization. What is the current progress in this regard? What measures will be taken next to help people who have been lifted out of poverty to improve their lives? Thank you.

Liu Huanxin:

Thank you for your concern and attention to consolidating and expanding the achievements of poverty alleviation.

2022 is the year of pursuing rural revitalization by building on the success in poverty alleviation in an in-depth manner. Through the joint efforts of all parties, our poverty alleviation achievements are further consolidated and expanded. The foundation of poverty alleviation is more solid and the results are more sustainable, which are mainly reflected in three aspects. First, there have been no people slipping back into poverty in large numbers. The monitoring and assistance mechanisms to prevent people from slipping back into poverty have played an effective role. The time spent on poverty identification and confirmation has been shortened to less than 15 days, and early detection, early intervention, and early assistance have been realized. The capacity for guaranteeing access to compulsory education, basic medical services and safe housing for impoverished rural residents, and the capacity for providing safe drinking water and meeting people’s basic needs continue to be consolidated and improved. Second, the employment situation of the labor force that was lifted out of poverty remains stable. In 2022, 32.779 million of them enjoyed full employment, an increase of 1.329 million from the end of 2021, exceeding the annual target by 2.587 million. Third, the income of areas and people that have been lifted out of poverty has increased rapidly. In 2022, the per capita disposable income of farmers in areas that have been lifted out of poverty reached 15,111 yuan, an increase of 7.5%, which is 1.2 percentage points higher than the growth rate of the per capita disposable income of farmers nationwide. The per capita net income of those that have been lifted out of poverty reached 14,342 yuan, a year-on-year increase of 14.3%, 8 percentage points higher than the growth rate of the per capita disposable income of farmers nationwide.

General Secretary Xi Jinping called for efforts to consolidate and expand our achievements in poverty alleviation and help areas and people that have just shaken off poverty build their own momentum for growth in his report to the 20th CPC National Congress. The task of consolidating and expanding achievements in poverty alleviation has continued to be put high on the agenda in the No. 1 central document for 2023 as one of the bottom-line tasks. We will thoroughly implement the decisions and arrangements made by the CPC Central Committee and the State Council and intensify efforts to carry out all work related to consolidating and expanding achievements in poverty alleviation, in a bid to further improve the livelihoods of people lifted out of poverty.

First, we will strengthen monitoring to ensure the implementation of poverty assistance work. We will carry out regular monitoring and centralized screening of monitored targets, further improve the accuracy of identification and targeted assistance, and promptly address the potential risks of returning to poverty due to epidemics , illnesses or disasters. We will provide classified assistance and implement development-oriented poverty reduction measures for monitored households that are able to work and willing to do so. We should also enhance social security guarantees for those who are unable to work.

Second, we will foster driving force for development. We should regard increasing the income of people lifted out of poverty as a fundamental measure, take accelerating the development of counties lifted out of poverty as the main direction, focus on industrial employment and give full play to the role of development, so as to further narrow the gaps in income and development, and help areas and people lifted out of poverty build their own momentum for growth. We will make good use of the central government's subsidies for rural revitalization to improve weak links of poverty-stricken areas in technology, infrastructure, marketing and other industries. We will deepen cooperation in labor services coordination between eastern and western regions, create more jobs for people lifted out of poverty to prevent them from returning to poverty, and ensure that the scale of employment for those lifted out of poverty remains stable at over 30 million .

Third, we will further improve relevant policies. We will fully implement the policy of effectively linking our achievements in poverty alleviation and rural revitalization, and continue to give greater priority to policies in key counties for rural revitalization and in key areas such as poverty-alleviation relocation centers in inhospitable areas. We will deepen cooperation between the eastern and western regions, mobilize central government departments to provide designated assistance, and encourage more assistance mechanisms such as the "10,000 Enterprises to Aid 10,000 Villages" program, to generate synergy to prevent people from falling back into poverty. We will give full play to the role of assessment and evaluation as the "baton" to consolidate and expand the achievements in poverty alleviation and rural revitalization, and strengthen responsibilities at all levels. Thank you. 

China County Times:

As with the virtuous circle of "science, industry and finance" proposed at last year's Central Economic Work Conference, the development of agriculture and rural areas cannot be separated from the support of funds and policies. Therefore, I would like to ask what measures will be taken in the field of agriculture and rural areas to strengthen policy guarantees and institutional innovation? Thank you.

Tang Renjian:

This question is related with the driving force behind building China's strength in agriculture, that is, where the driving force originates. Thank you for your question, which is a profound one. 

To promote all-around rural revitalization and build up strength in agriculture, we need to make concrete efforts, make real investments, and work together to create policy synergy. This year’s No. 1 central document focuses on areas such as investment, talent, mechanism, and institutional guarantees. 

First, we must improve the investment mechanism through multiple channels to boost rural revitalization, initially via government investment. The document prioritizes agriculture and rural areas as key areas for the national general public budget and requires local governments to take full responsibility for their investments. Efforts will be made to increase the proportion of land transfer revenue that is used for agriculture and rural areas. Eligible rural revitalization projects will be supported via local government bonds. Second, via financial investment. We need to better leverage policy tools, such as relending and rediscounting programs, differentiated reserved requirement ratios, differentiated financial regulation, and assessment and evaluation policies. We encourage financial institutions to increase their lending in the areas related to rural revitalization, with a focus on ensuring credit funding for food security. Third, via investment from social capital. There is a need to improve the linkage mechanism between government investment, financial investment, and social investment. We encourage the bundling of eligible projects implemented by market entities according to regulations. In the agricultural and rural investment sector, projects are often dispersed across many households and vast farmland, and individual projects are often scarce. However, when aggregated at a city, provincial, or national level, the scale can be significant. Therefore, the bundling of projects is necessary to facilitate deposits, loans, and implementation.

Second, we must strengthen the building of the rural talent pool. This involves a combination of cultivating and introducing talent. On one hand, efforts will be made to cultivate local talent in rural areas, such as implementing plans to train high-caliber farmers, carrying out initiatives to cultivate rural entrepreneurial leaders, and developing vocational education for rural revitalization. On the other hand, urban talent will be encouraged to go to the countryside. A program to support rural revitalization talent will be launched, guiding university graduates, skilled professionals, migrant workers, and entrepreneurs to return to or work in rural areas. These four groups of people were mentioned in the speech made by General Secretary Xi Jinping at the central rural work conference at the end of last year. They are encouraged to work at the grassroots level. Additionally, incentive mechanisms will be improved to encourage urban professionals and technical personnel to regularly serve rural areas. Preferential treatment in terms of job promotion and professional title evaluation will be given to those who serve rural areas long-term.

Third, we will improve the mechanism for advancing rural revitalization. The mechanisms mainly relate to the following aspects. First, we need to fully implement the system of responsibility for rural revitalization. We should ensure that Party secretaries at the provincial, municipal, county, township, and village levels assume their responsibilities in implementing rural revitalization. As in poverty alleviation, Party secretaries at five levels are responsible for advancing progress, and we will also adopt this approach in promoting rural revitalization to form a policy and work synergy. Second, we need to improve mechanisms for inspecting and evaluating rural revitalization. Concerted efforts will be taken to conduct performance evaluations on the implementation of the rural revitalization strategy and to carry out assessments on the coordinated efforts between expanding and consolidating poverty alleviation and rural revitalization. We should also make the promotion of rural revitalization through Party building a key part in evaluating the performance of Party secretaries at the five levels. Third, we need to establish a statistical monitoring system for rural revitalization. We should strengthen the statistical monitoring of rural revitalization, set up indicators and statistical systems that reflect the progress of rural revitalization in an objective manner, and conduct evaluations of the implementation of the rural revitalization strategy in a timely and scientific manner. Thank you.

Sannongfabu:

In recent years, the incomes of farmers have grown rapidly, and the income gap between urban and rural areas has gradually narrowed. What are the current channels for farmers to increase their incomes? And what measures are there to help farmers boost their incomes? Thank you.

Tang Renjian:

The phrase "increasing incomes and getting richer" has been used for many years, and was also mentioned in the report to the 20th CPC National Congress and in the No. 1 central document for 2023. I think it has a new meaning in the new stage. Currently, the phrase obviously means to gain common prosperity for everyone. So, from this perspective, it is an old term, but with new connotations and requirements. I'd like to invite Mr. Wu Hongyao to address this question in detail. 

Wu Hongyao:

This is a very important issue. The work on China's agriculture, rural areas and farmers has two main tasks: One is ensuring supplies, and the other is increasing incomes. Therefore, increasing incomes for farmers has indeed been a key task for the work on agriculture, rural areas and farmers. I'll explain more. 

General Secretary Xi Jinping has stressed on many occasions that we must continue to make increasing rural incomes the central task of our work on agriculture, rural areas and farmers, and do everything possible to expand channels for farmers to increase incomes and get richer. Since the 18th CPC National Congress, farmers' incomes have continued to grow rapidly. In 2019, the target of doubling the income of 2010 was achieved one year ahead of schedule. In 2022, the per capita disposable income of rural residents exceeded 20,000 yuan for the first time, reaching 20,133 yuan. The income ratio between urban and rural residents declined from 2.88 in 2012 to 2.45 in 2022. The income gap between urban and rural residents has gradually narrowed. However, we have also noticed that the growth rate of farmers' incomes has slowed, and the driving force of income growth has weakened. We must pay close attention and take practical measures that combine both short- and long-term solutions to expand channels for farmers to increase their incomes. On this regard, the No. 1 central document this year has made arrangements, which focus on four aspects:

First, we need to stabilize employment. In 2022, incomes from wages and salaries accounted for 41.96% of farmers' incomes, which made the major contribution to the increase in farmers' incomes. We will strengthen the implementation of various policies to stabilize employment, improve employment skills, increase job positions, create employment opportunities and stabilize the employment of rural migrant workers. Our research shows that, currently, more than three-quarters of rural migrant workers are employed within their provinces; and more than half are employed in their counties. We should follow this trend and develop county-level industries which have competitive advantages, strong motivational ability and large employment capacity, so as to encourage rural residents to find jobs and start businesses locally. 

Second, we will focus on increasing the effectiveness of the operation. The net income from household operations accounted for 34.63% of farmers' income. Among them, over 60% comes from agricultural operating income. We will cultivate new types of agribusinesses and improve commercial services catering to small agricultural households, to improve farmers' income. We will carry out a promotional campaign to offer services for agriculture businesses to help plant and harvest crops and even manage everything involved in the agricultural production process. Then, we can encourage small household farmers to save costs, improve quality and promote marketing.

Third, we will tap the potential of property income. Net property income accounted for 2.53% of farmers' income. There is still much potential and space to be tapped. We will deepen the reform of the rural land system to ensure the affirmation of rights to contract rural lands, promote endowment steadily, and protect the flexible management rights in an orderly way so that farmers can increase property income and enjoy the dividends of the reform.

Fourth, we will pay more attention to transferring income. Farmers' net transfer income accounted for 20.88% of their income. It is an important component of farmers' income, especially those lifted out of poverty and those with low incomes in rural areas. We will continue to beef up policy support to strengthen agriculture, benefit farmers, and raise rural living standards. We will ensure that the social security level is improved in rural areas and that farmers get more subsidies. By doing so, we aim to provide a safety net concerning social security and ensure people prosper in rural areas. Thank you.

Tang Renjian:

We just mentioned that increasing farmers' incomes is the central task of the work concerning agriculture, rural areas, and farmers. Moreover, we should note that food security is a top priority. We need to handle holistically the relationship between these two tasks, which are both vital to our development.

Red Star News:

The launch of rural reform is the key to the rural revitalization strategy. According to the No. 1 central document for 2023, what new tasks and requirements have been pushed forward to advance rural reform, stimulate production factors and resources in rural areas, and spur internal creativity? Thank you. 

Wu Hongyao:

The No. 1 central document for 2023 mentioned two drivers: scientific and technological innovation and institutional innovation, i.e. reform. I will answer your question.

General Secretary Xi Jinping stressed the need to rely on reform to speed up building strong agriculture. The overall idea for deepening rural reform in the new era and on the new journey is to continue to handle the relationship between farmers and land properly. We must align strengthening the foundation of collective ownership, safeguarding and realizing the rights of farming collective members with activating resource elements to improve the separation of rights and interests over rural collective resources and assets. We need to ensure farmers can share more of the fruits of reform. In the No. 1 central document for 2023, we have made deployments and arrangements from three areas.

First, we will deepen reforms of the rural land system. We will mainly advance reform concerning rural contracted land, residential land, and collective land for development purposes. With regard to contracted land, we will steadily advance trials on extending the second round of rural land contracts for another 30 years upon expiration. We will gradually expand the scope of the pilot scheme, uphold the principle of maintaining overall stability and making minor adjustments to ensure the original contract rights of most farmers remain stable and are smoothly extended. In regions where conditions permit, we will explore resolving the fragmentation of farmland based on the premise of farmers' willingness. In terms of rural residential land, we will give priority to advancing trial reforms on rural land designated for housing in a steady and prudent fashion. Focusing on ensuring housing, controlling illegal construction, making use of idled land, and based on the work to determine, register, and certify both land and house rights, we will strengthen management and explore ways to achieve the separation of ownership, entitlement, and right to use of rural land designated for housing. Concerning rural collective land for development purposes, we will focus on advancing trials for marketing rural collective land for development purposes. We will establish effective regulatory mechanisms for distributing revenues from the appreciation in land values between the state, rural collective economic organizations, and farmers. 

Second, we will develop new collective economies in rural areas. We will continue to advance the reform of the rural collective property rights system and consolidate and expand its achievements. We will work to improve the operation mechanism, advancing the development of an operation mechanism with clear property rights, sound governance structures, steady ways of operation, and reasonable distribution of benefits. We will also explore diversified means to develop new collective economies in rural areas and promote various models, including the contract of resources, the rental of property, the intermediary services, and the share participation of assets. At the same time, we will improve the regulatory system for rural collective assets and fully protect collective members’ rights to know, participate, and supervise.

Third, we will promote integrated urban-rural development in counties. Counties connect urban and rural areas and serve as basic units of economic and social development. They have huge potential in helping expand domestic demands and foster a new development pattern. Over the years, we have seen that more and more people who have moved from rural to urban areas seek employment and start businesses in counties and gain permanent urban residency there. There are 910 million permanent urban residents in China, and nearly one-third of them live in the urban areas of counties and county-level cities. Based on that, we will take counties as a focal point and improve institutions and mechanisms, and policy systems for urban-rural integrated development to ensure the smooth flow of factors of production between urban and rural areas. We will coordinate the planning and development of urban and rural areas in counties; allocate public resources in counties, townships, and villages in an incremental manner; and continue to grant permanent urban residency to rural migrant workers in counties. With all these efforts, we will gradually break the barriers between urban and rural areas in counties and build counties as an important bond for industry-agriculture and urban-rural synergies. Thank you.

Tang Renjian:

Let me emphasize how Mr. Wu Hongyao’s answer just now and this year’s No. 1 central document both mention new collective economies in rural areas. New collective economies in rural areas have been talked about for many years, but it has not been stated explicitly what the new collective economy is and how to develop it. This time, we actually make clear the new collective economy that we will develop, which can be generalized into four aspects. That is the economy with an operation mechanism with clear property rights, sound governance structures, steady ways of operation, and reasonable distribution of benefits. How to develop the new collective economy in rural areas? There are also four aspects, including promoting various models, including the contract of resources, the rental of property, the intermediary services, and the share participation of assets. Therefore, I would like to make this point clear that answers have been provided concerning innate laws and pathways of development of the new collective economy in rural areas.

China Daily:

According to the report to the 20th CPC National Congress, we will build a beautiful and harmonious countryside that is desirable to live and work in. What specific arrangements have been made in this regard in the No. 1 central document for 2023? Thank you.

Liu Huanxin:

Thank you for your question. General Secretary Xi Jinping has stressed that building a beautiful and harmonious countryside that is desirable to live and work in is integral to building China's strength in agriculture. From building a beautiful countryside to a beautiful and harmonious countryside that is desirable to live and work in, the content and goal of rural development have been further enriched and broadened. It also underlines how rural development should focus on both material elements and the people and work on advancing material and cultural progress to achieve the all-around development of rural areas. The No. 1 central document for 2023 has made specific arrangements concerning building a beautiful and harmonious countryside that is desirable to live and work in, with a focus on advancing both material and cultural development. 

First, we will work to promote material development and ensure modern standards of living in rural areas. The report to the 20th CPC National Congress has taken ensuring modern standards of living in rural areas as one of China's overall development objectives by 2035. Last year, the general offices of the Communist Party of China Central Committee and the State Council issued the Action Plan on Rural Construction. We will focus on improving rural living environments, rural infrastructure, and basic public services and advance rural development in an effective and orderly manner. We will give priority to establishing three mechanisms. First, we will build the mechanism that gives full play to the guiding role of rural development plans. In response to the changes in urban-rural structure and new forms of the countryside, we will advance the planning and construction of urban and rural infrastructure and public service systems in a coordinated way. We will pool resources to work on projects that are inclusive, meet essential needs, and ensure basic living standards for people in difficulty. We will also give priority to programs that both bring convenience to people’s lives and promote production. Second, we will build a mechanism that improves the features of the countryside. The original features of the countryside will be demonstrated, and elements of modern life will also be incorporated. We will ensure the integrity of the space and modernization of the infrastructure and preserve the history and original features so as to preserve the customs and charms of the countryside and retain its cultural roots. Third, we will build the mechanism for farmers’ participation. We will respect farmers’ aspirations; widely listen to public opinions on what to build, how to build, and how to manage; and guide farmers to participate in the whole process of rural construction.

Second, we will work to promote cultural development in the countryside and foster a prevailing ethos of kindness, friendship, harmony, and peace. Since ancient times, China has valued the idea of harmony. People follow the laws of nature and take local conditions into consideration in agricultural production. In rural living, people pursue kindness and friendship and value peace and harmony. The villages and settlements are in harmony with the environment and nature. The idea of harmony shall be upheld throughout the process of rural construction to nurture people, educate people, and unite people so as to ensure good social morality and peace and stability in the countryside. First, we will integrate carriers to strengthen and improve rural governance. We will improve primary-level social governance platforms featuring grid-based management, meticulous services, and IT support and integrate effective systems, including a points-based system and the list system. We will also pool the strengths of various departments in a coordinated way to improve rural governance efficacy. Second, we will take innovative measures to advance progress in culture and ethics in the countryside. Based on the needs and desires of farmers, we will provide more interesting, farming-related rural cultural products and services that showcase harmonious living, amicable relationships, and beautiful surroundings in the countryside. We will continue to update outmoded and undesirable habits and customs, and prevent unhealthy tendencies and make extensive efforts to promote good habits and customs in the countryside by formulating regulations, improving village rules and regulations, and making party members and officials serve as role models.

Tang Renjian:

From a beautiful countryside to a beautiful and harmonious countryside, with one word – change – our goals have become richer and deeper. Thank you.

Chen Wenjun:

The last question, please.

CRNTT:

The development of industries is a top priority on the agenda of rural revitalization. What are your considerations concerning implementing supportive policies in this regard and enabling the industry of local specialties to advance rural revitalization? Thank you.

Tang Renjian:

Just now, there was a question about increasing the income of farmers, behind which the most important support is actually the development of industries. General Secretary Xi Jinping has made it clear that the development of industries is the most important on the agenda of rural revitalization, and it tops the “five priorities” of rural revitalization. He also made clear requirements that particular attention should be paid to local specialties at the Central Rural Work Conference held last year end. In this year’s No. 1 central document, specific arrangements have been made concerning the high-quality development of rural industries. Priorities will be given to the following four aspects.

First, we will work on promoting specialties. The development of rural industries depends on making good use of local resources. That is their specialty: diversified agricultural and sideline products, beautiful countryside sceneries, and traditional culture that values farming and education. All of these are attractive features of the countryside and provide unique conditions for the development of rural industries. We should accommodate changes in the market demand and make full use of the special resources of agriculture and rural areas to develop a variety of agricultural functions and multiple types of value in rural areas. We will make breakthroughs in the development of industries in accordance with the local conditions and turn the advantages in resources, eco-environment, and culture into advantages in products and industries to strengthen competitiveness and capacity for sustainable development. 

Second, we will work to promote industrial integration. We will focus on giving full play to the role of the multiplier effect brought about by the three industrial integrations, which we are all familiar with, and work to develop leading enterprises, strengthen weak links, boost all forms of business, and establish self-developed brands. We will break barriers between the production, processing, and sale of agricultural products and develop agricultural products processing and distribution industries. We will foster industries for precooked dishes and improve the standardization of industries for fresh-cut vegetables and the central production kitchen. We will also promote the local conversion and processing of agricultural products and promote transformation from selling raw materials to processed products. We will promote the integration of agricultural, cultural, and tourism industries and accelerate the modern rural service industry, meeting the consumption needs of urban and rural residents. The intermediary services in the new collective economies in the rural areas we just mentioned also refer to that. We will encourage the development of shopping, culture, sport, tourism, elderly care, and child care along with information intermediaries and other daily life services and promote the transformation from selling products to selling both products and services. We just talked about the transformation from selling raw materials to processed products. This is the transformation from selling products to selling both products and services.

Third, we will optimize the layout. We will foster and develop county-level industries that benefit the people. We will prioritize the construction of industrial parks and zones and improve the layout of industries at the county, township, and village levels. We will take the whole county into consideration when making development plans and make a reasonable layout of production, processing, sales, consumption, and other sectors. We will work to improve the carrying capacity and supporting services of county-level industries and give better play to the role of major towns in attracting people. We will guide agricultural product processing enterprises to locate in product origin centers and industrial parks. With all these efforts, we will build industrial clusters that connect urban and rural areas.

Fourth, we will work on connecting and leading farmers. The above-mentioned three measures will make little sense if without doing a good job in connecting and leading farmers. We will guide enterprises to make full use of their advantages and to develop themselves in the process of leading and serving farmers. We will improve the mechanism from which farmers can benefit from a closer integration into agricultural industrial chains, and accelerating the development of the pattern featuring mutual complementarity and division of labor between enterprises and farmers, so as to leave more benefits to farmers as industries produce more value. Moreover, we will improve guidance for nongovernmental businesses to invest in agriculture and rural areas. While encouragement and guidance will be provided, whole-process supervision will also be carried out concerning the introduction, use, and exit of nongovernmental businesses. By doing so, farmers can gain benefits to the greatest extent, and their interests will be safeguarded. Thank you.

Chen Wenjun:

Thanks to all the speakers and friends from the media. Today’s briefing is hereby concluded. See you!

Translated and edited by Zhang Liying, Wang Qian, Zhu Bochen, Liu Sitong, Zhang Rui, Yang Xi, Yan Bin, Yuan Fang, Qin Qi, Cui Can, Zhou Jing, Yan Xiaoqing, Li Xiao, Ma Yujia, Wang Yiming, Zhang Junmian, Xu Kailin, Li Huiru, David Ball, Tom Arnsten, and Jay Birbeck. In case of any discrepancy between the English and Chinese texts, the Chinese version is deemed to prevail.

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Speakers:

Ms. Guo Tingting, vice minister of commerce

Mr. Yang Tao, director general of the Comprehensive Department of the Ministry of Commerce (MOFCOM)

Mr. Xu Xingfeng, director general of the Department of Market Operation and Consumption Promotion of MOFCOM

Mr. Li Xingqian, director general of the Department of Foreign Trade of MOFCOM

Ms. Meng Huating, an official at the Department of Foreign Investment Administration of MOFCOM

Chairperson:

Ms. Shou Xiaoli, deputy director general of the Press Bureau of the State Council Information Office (SCIO) and spokesperson of the SCIO

Date:

Feb. 2, 2023

Shou Xiaoli:

Friends fro the media, good afternoon. Welcome to this press conference held by the State Council Information Office (SCIO). Today, we have invited Ms. Guo Tingting, vice minister of commerce, to brief you on China's commerce work and development in 2022 and take your questions. We also have with us Mr. Yang Tao, director general of the Comprehensive Department of the Ministry of Commerce (MOFCOM); Mr. Xu Xingfeng,director general of the Department of Market Operation and Consumption Promotion of MOFCOM; Mr. Li Xingqian, director general of the Department of Foreign Trade of MOFCOM; and Ms. Meng Huating, an official at the Department of Foreign Investment Administration of MOFCOM.

Now, I'll give the floor to Ms. Guo for a brief introduction.

Guo Tingting:

Thank you. Friends from the media, good afternoon. Welcome to today's press conference. As we move beyond the recent seven-day holiday, I would like to extend my belated happy Chinese New Year wishes. I also want to express my deep gratitude for your continued interest in and support for our commerce work. Now, I would like to provide a brief overview of our business operations in 2022.

In 2022, under the strong leadership of the Central Committee of the Communist Party of China (CPC) with Comrade Xi Jinping at its core, MOFCOM steadfastly carried out the decisions and deployments of the CPC Central Committee and the State Council. It effectively addressed the impact of unforeseen factors, balanced epidemic control and business development, and effectively implemented a range of policies and follow-up measures to stabilize the economy. The overall business operations made steady progress throughout the year, positively impacting the stability of the overall economic and social landscape. To be specific: 

The consumer market was generally stable. China's retail sales of consumer goods in 2022 hit 44 trillion yuan, basically unchanged from 2021. The trend of new consumption is positive. Online retail sales of physical goods grew by 6.2%, further increasing their share of total social retail sales to 27.2%. Physical retail sales continued to grow, with a 1% increase in retail sales of goods from physical stores above designated size. The market for consumer goods is expanding and customer experience is improving. The demand for upgraded products surged, leading to a 93.4% increase in sales of new energy vehicles.

Foreign trade exceeded expectations. Despite the challenges faced last year, efforts were made across departments and regions to effectively address them. As a result, China's foreign trade hit a new record high with a total of 42.1 trillion yuan, a 7.7% increase year on year, exceeding the 40-trillion-yuan mark. Trade with major partners continued to grow. Imports and exports to the top three trading partners, ASEAN, the European Union and the United States, increased by 15%, 5.6% and 3.7%, respectively. The trade structure has also been optimized. Foreign trade by private firms jumped 12.9% to account for over 50% of the total. The export of labor-intensive products and electromechanical products increased by 8.9% and 7%, respectively. In particular, the export of new energy vehicles and other products has grown rapidly, and the new competitive advantage is rapidly taking shape. Trade in services also grew steadily, reaching 5.98 trillion yuan, a 12.9% increase, with travel and knowledge-intensive services increasing by 8.4% and 7.8%, respectively.

The use of foreign capital continued to grow. China's actual use of foreign capital hit 1.2 trillion yuan in 2022, up 6.3% year-on-year on a comparable basis, once again proving China's continued appeal as a popular destination for foreign investment. The quality of foreign investment continued to improve, with a 46.1% increase in manufacturing investment, accounting for 26.3% of the total, an increase of 7.8 percentage points over 2021. Investment in high-tech industries increased by 28.3%, accounting for 36.1%, with an increase of 7.1 percentage points over the previous year. Investments from major sources of foreign capital continued to grow. Investments from Germany, South Korea and the United Kingdom increased by 52.9%, 64.2% and 40.7%, respectively, and investments from Hong Kong increased by 1.7%. Pacesetters in opening-up have exhibited a positive influence by setting an example. The 21 free trade pilot zones attracted foreign investment amounting to 22.252 billion yuan, representing 18.1% of the national total. Additionally, the 230 national economic development zones attracted foreign investment totaling 259.64 billion yuan, accounting for 21.1% of the national share.

Foreign investment grew steadily. China's non-financial outbound direct investment rose 7.2% to 785.94 billion yuan. Among this, investment in countries along the Belt and Road increased by 7.7%, accounting for 17.9%. In terms of industries, investment in the manufacturing sector increased by 22.4%, accounting for 18.5%; investment in the wholesale and retail industry and construction industry increased by 24.6% and 19.8%, respectively; investment cooperation in green, digital and other fields have become new growth drivers. Foreign contracted projects developed steadily, with a turnover of 1 trillion yuan, an increase of 4.3%; and the number of newly signed projects with a contract value of more than $50 million increased by 59 compared with 2021.

Significant progress was made in bilateral and multilateral cooperation. Head-of-state diplomacy deepened economic and trade ties. Last year, we promoted the G20 and APEC to achieve positive results in the economic and trade field, and successfully held the BRICS Trade Ministers Meeting and Meeting of the Shanghai Cooperation Organisation Member States Ministers Responsible for Foreign Economic and Foreign Trade. We promoted a package agreement reached at the 12th WTO Ministerial Conference and advanced the substantive conclusion of investment facilitation negotiations. China officially launched negotiations for its accession to the Digital Economy Partnership Agreement. The joint feasibility study for building the "version 3.0" China-ASEAN Free Trade Area was completed and negotiations began. The Regional Comprehensive Economic Partnership (RCEP) agreement came into effect and was implemented with high quality. 30.8% of China's total foreign trade was with other RCEP members.

This year marks the first year of fully implementing the guiding principles of the 20th CPC National Congress. MOFCOM will follow the guidance of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, fully implement the guiding principles of the 20th CPC National Congress, and steadfastly carry out the directives from the Central Economic Work Conference. In line with the requirements of the State Council executive meeting, based on our key roles in promoting domestic circulation, dual circulation and fostering a new development pattern, we will focus on restoring and expanding consumption, promoting stable growth, optimizing the structure of foreign trade, and making greater efforts to attract and utilize foreign investment. We will also advance high-level openness and boost market confidence, drive high-quality business development, provide crucial support for stabilizing economic growth, employment and prices, and make positive contributions for comprehensively building a modern socialist country.

Next, my colleagues and I will take your questions. Thank you.

Shou Xiaoli:

Thank you. The floor is now open to questions. Please identify the media outlet you represent before asking your questions. 

ThePaper.cn:

In 2022, China's foreign trade withstood the impact of multiple unexpected factors, and the total value of imports and exports exceeded 40 trillion yuan for the first time. What were the highlights of China's foreign trade growth in 2022? Facing a potential international landscape that may include shrinking overseas demand, what measures will MOFCOM take in 2023 to stabilize foreign trade? Thank you.

Li Xingqian:

Thank you for your attention to foreign trade. China's foreign trade experienced an extremely challenging year in 2022. Under the strong leadership of the CPC Central Committee and the State Council and thanks to the cooperation between MOFCOM and various localities and departments, foreign trade enterprises rose to challenges and foreign trade performed exceptionally after withstanding various risks and tests. It also successfully achieved the goal of sustaining stability and improving quality. Overall, our foreign trade's outstanding performance in 2022 can be summed up in three respects: reaching a new height, unleashing new impetus and making new contributions. 

Regarding the new height, China's import and export volume in 2022 hit a record high again at 42 trillion yuan, passing the 40-trillion-yuan mark. In U.S. dollar terms, the volume reached $6.3 trillion, which is an unprecedented increase from the ultra-large base reached in 2021. We have remained the largest trader of goods for six consecutive years. While the volume registered sound growth, the structure also continuously improved. The share of imports and exports of private enterprises increased, and their export share rose by 3.2 percentage points to 60.8%. Multilateral and bilateral economic and trade cooperation also made positive progress. Exports to RCEP trading partners grew by 17.5% year on year, 7 percentage points higher than the overall growth rate. The proportion of imports and exports to Belt and Road partner countries reached 32.9%, up by 3.2 percentage points from 2021.

Regarding the new impetus, China's high-tech, high-value-added products contributing to the green transformation, such as electric vehicles, photovoltaic products and lithium batteries, have become a new growth driver of exports. In 2022, exports of electric vehicles increased by 131.8%, photovoltaic products by 67.8%, and lithium batteries by 86.7%. At the same time, new foreign trade forms, such as cross-border e-commerce and market procurement trade, also boomed, with the import and export volume exceeding 3 trillion yuan and accounting for more than 7% of foreign trade.

Regarding the new contributions, domestically, foreign trade made an important contribution to promoting overall economic recovery. Net exports of goods and services contributed to 17.1% of GDP growth last year, driving GDP growth by half a percentage point. There were 598,000 foreign trade enterprises with robust import and export performance last year, an increase of 31,000 compared with 2021, effectively promoting employment stability in the country. Internationally, amid the turbulent global economic and trade environment, China took effective measures to stabilize production and exports, ensuring the smooth operation of the global industrial and supply chains. Meanwhile, we actively expanded imports. China's import volume reached $2.7 trillion last year, making it a key contributor to global economic and trade development.

At present, foreign trade development is facing an extremely severe environment, as the risk of a global economic recession is rising, the growth of external demand is slowing down significantly, and the international supply chain is restructuring at a faster pace. In 2023, we will make greater efforts to maintain volume stability and optimize structural aspects of foreign trade and stabilize the supporting role of exports in the national economy. We prioritize respecting and stimulating the creativity of trade entities. On Dec. 30, 2022, the Foreign Trade Law was amended, which abolished the requirement for certain filing and registration procedures for foreign trade operators. This actually grants all market entities the right to conduct foreign trade, which is a major reform of China's foreign trade management.

To promote high-level opening up, it is important to make foreign trade easier, more convenient, and more rewarding. Therefore, in the new year, we must carefully serve the main body of foreign trade enterprises, optimize and introduce new trade policies, help enterprises reduce costs, increase efficiency and solve problems, and continue to improve the overall competitiveness of foreign trade. Our focus is on implementing the following four measures. The first is to strengthen trade promotion. We will closely connect suppliers and purchasers to stabilize exports and fully resume offline events of a series of domestic export fairs such as the China Import and Export Fair (Canton Fair). At the same time, we will fully support foreign trade enterprises participating in various overseas professional expos to create more trade opportunities. The second is to expand imports reasonably. We will closely cooperate with our trading partners, leverage the advantages of our super-large market, and expand the imports of high-quality products from other countries so as to stabilize the global trade supply chain. The third is to deepen trade innovation. We will promote the continuous, rapid and healthy development of new business forms, including cross-border e-commerce and overseas warehouses. The fourth is to stabilize the industrial base of foreign trade. We will continue to optimize the industrial structure of foreign trade and, while strengthening general trade, support the gradual relocation of processing trade to the central, western and northeastern regions for upgrading and development. Thank you!

Phoenix TV:

Over the past year, the CPC Central Committee and the State Council have released a series of policies and measures to stabilize the economy. Consumption plays a fundamental role in sustaining economic growth. What are the measures the Ministry of Commerce has taken to promote consumption? What are the highlights? Thank you.

Xu Xingfeng:

Thank you for your question. As you mentioned, last year, the CPC Central Committee and the State Council promptly issued a series of policies and measures to stabilize the economy, among which promoting consumption was a major part of our work. The Ministry of Commerce fully implemented the decisions and plans made by the CPC Central Committee and the State Council. First, we adopted detailed policies and concrete measures to recover and expand consumption actively. Ms. Guo just briefed us about the progress made in consumption. We have stabilized the consumption sector. Over the past year, we have focused on the following aspects:

First, we encouraged spending on major consumption. We usually call vehicles, home appliances, catering and housewares the four pillars of the consumption sector. Together they account for about a quarter of the total retail sales of consumer goods. Regarding vehicles, we worked with related departments and issued policies to stimulate auto circulation and expand spending on vehicles. As you may recall, a press conference was held to introduce such policies. These policies were efficient, covering 12 items in six aspects, and achieved substantial progress. In the second half of 2022, the sales of vehicles stopped falling and rebounded, registering a negative growth of 6.6% in the first half of the year and a positive growth of 10.7% in the second half of the year with the support of such policies. The proportion of new energy vehicles (NEVs) to new car sales increased from one-eighth in 2021 to one-fourth in 2022, meaning that one out of every four vehicles was a NEV, rising from one in eight vehicles previously. In addition, we worked with relevant departments to promote the sales of green and smart home appliances and green building materials in rural areas. In terms of catering, targeted support policies have been introduced to encourage the recovery and development of catering consumption.

Second, we accelerated the development of new types of consumption. Targeted measures have been taken to promote e-commerce, green consumption, and winter sports-related consumption, advance the integration of online and offline consumption, and create new opportunities in the consumption sector. Online retail sales of physical goods climbed 6.2% year on year, 2.7 percentage points higher than in 2021. Online consumption is particularly striking in live-streamed e-commerce, where the number of live broadcasts, viewers, live-streamed products, and active hosts all multiplied compared to 2021.

Third, we upgraded the platforms and carriers of the consumption sector. The carriers refer to cities and rural areas. In terms of cities, we accelerated the development of international consumption center cities, held the first forum on international consumption center cities, and promoted the first 14 items of practices in four aspects. We focused on the role of 15-minute community life circles in cities, while leveraging the role of platforms such as smart stores and smart business districts. In other words, our efforts covered cities, sub-districts and business districts. At the same time, we carried out a three-year action plan to develop county-level commercial systems, improve county-level consumption channels, and steadily increase the proportion of retail sales of consumer goods at the township and county level to the total social retail sales throughout the year.

Fourth, we held various consumption promotion activities. While ensuring epidemic prevention and control measures, we successfully held a series of major exhibitions and fairs, including the China International Import Expo, the China International Consumer Products Expo, and the China International Fair for Trade in Services. By hosting such fairs, we were able to increase the supply of quality goods and services. In addition, we also organized a series of activities, including the International Consumption Season, a nationwide month-long pro-consumption campaign, an online Lunar New Year's Shopping Festival, the Brand and Quality Online Shopping Festival , the Home Appliances Consumption Season, and the Chinese Food Festival, to attract consumers. We guided local governments to carry out consumption promotion activities in line with local conditions. The central and local governments worked together, and ministries, associations and local governments held various activities to boost consumption.

Fifth, we ensured the consumption of necessities. As we all know, pandemic outbreaks emerged in different places in the past year, such as Shaanxi, Jilin, Shanghai, Hainan, Tibet and Xinjiang. We firmly implemented the decisions and plans made by the CPC Central Committee and the State Council. Putting people and their lives first, we established a cross-regional mechanism to ensure the supply of daily necessities and increased support for organizing and transporting goods. A response mechanism was built into the market to promptly follow up on any shortages of daily necessities. We released 10 batches of over 140,000 tons of central meat reserves into the market, effectively ensuring people's consumption needs in key regions and periods of time.

With these measures, the consumption market has been effectively stabilized. The market continued to show healthy momentum during the Spring Festival period. According to our monitoring, the sales revenue of key retail and catering enterprises increased by 6.8% compared to the same period last year. In 2023, we will continue to fully implement the decisions and plans made by the CPC Central Committee and the State Council, strive to overcome possible difficulties and challenges, and promote economic recovery and consumption through practical actions. 

Thank you!

CCTV:

As China's vanguard of reform and opening-up, how was the construction of pilot free trade zones (FTZs) in 2022? What results have been achieved? For the next step, what are the considerations of MOFCOM in constructing pilot PFTZs in 2023? Thank you.

Guo Tingting:

Thank you for your questions. I will briefly answer them. The construction of pilot FTZs is a crucial strategic measure taken by the CPC Central Committee with Comrade Xi Jinping at its core to deepen reform and opening-up in the new era. In 2022, all pilot FTZs across the country made further advancements by forging ahead and exploring bravely. Those achievements were mainly demonstrated in the following aspects.

First, we have promoted high-quality opening-up. All pilot FTZs have implemented a slew of measures to deepen opening-up in the field of investment and trade in a bid to give full play to the leading role of opening up. They have made positive contributions to the development of foreign trade and investment. Since the new negative lists for foreign investment market access for pilot FTZs took effect on Jan. 1, 2022, the amount of items in the manufacturing sector on the negative list for pilot FTZs has dropped to zero, and the service sector has constantly deepened opening up. In 2022, the actual use of foreign capital in the 21 pilot FTZs totaled 222.52 billion yuan, accounting for 18.1% of the country's total. Among those, the actual use of foreign capital in high-tech industries reached 86.34 billion yuan, up 53.2% year on year. At the same time, local governments have taken innovative measures to further enhance trade liberalization and facilitation. Guangxi, Yunnan and Heilongjiang have explored new models to facilitate frontier trade among inhabitants of border regions. Shaanxi has pioneered the "customs declaration before packing" mode to clear cross-border e-commerce bulk cargo, shortening the customs clearance time by two to three days. In 2022, the total import and export volume of the 21 pilot FTZs reached 7.5 trillion yuan, up 14.5% year on year, accounting for 17.8% of the country's total.

Second, we have deepened reform and innovation. Pilot FTZs have strived to improve governance capacity through institutional innovation, to further optimize the business environment. In 2022, MOFCOM and relevant departments issued 56 documents to support the development of pilot FTZs, empowering those pilot FTZs to conduct more reform tasks on a trial basis. As of the end of 2022, all provinces, autonomous regions and municipalities directly under the central government have delegated more than 5,400 items of provincial-level administrative authority to pilot FTZs, significantly streamlining the approval process. Shandong, Guangxi and other places have even innovated and rolled out negative lists for delegating power.

Third, we have boosted high-quality development. Pilot FTZs have actively explored ways to remove institutional barriers that hinder the accumulation of innovative resources and factors at home and abroad. This has accelerated the development of new industries, business forms and models. Several competitive industrial clusters have already taken shape. For example, the Xiyong bonded area in Chongqing has formed a hundred-billion-yuan intelligent terminal industry cluster with an annual output of more than 100 million units. The bonded area of Wuhan in Hubei province has made extensive efforts to develop the optoelectronic information industry, gathering more than 16,000 related enterprises.

Fourth, we have supported major national strategies. Pilot FTZs have vigorously promoted cross-regional collaborative innovation. In 2022, Shandong, Henan, Sichuan and Shaanxi jointly built the Yellow River Basin Pilot Free Trade Zone Alliance with five other provincial-level regions along the Yellow River. Together with the previously established joint conference mechanism of the pilot FTZs in Beijing, Tianjin and Hebei and Yangtze River Delta Pilot Free Trade Zone Alliance, they have given full play to the influence and driving role of the new highland of reform and opening-up, injecting new impetus into serving and promoting the implementation of major national strategies, especially major regional strategies.

The 20th National Congress of the CPC proposed implementing a strategy to upgrade pilot FTZs. In 2023, we will earnestly fulfill the functions of the State Council's Inter-ministerial Joint Meeting for the Work of Pilot Free Trade Zones in accordance with the decisions and arrangements of the CPC Central Committee and the State Council. First, we will actively align with high-standard international economic and trade rules, intensify stress tests in pilot FTZs and free trade ports, and steadily advance opening up with institutional guarantees in the areas of management, standards, rules, and norms, to accumulate experience and explore ways to deepen domestic reform in relevant fields. Second, we will support pilot FTZs to conduct in-depth differentiated exploration and promote open and innovative development of the whole industrial chain in key areas such as integrated circuits, biomedicine, and high-end equipment manufacturing. Third, we will replicate and promote more and better institutional innovation achievements to further unleash the dividends of reform and opening-up. Thank you.

Reuters: 

Following last month's announcement that four Chinese coal importers have been granted permission to resume import of Australian coal, does China plan to lift restrictions on a broader range of Australian exports, such as cotton, rock lobster, wine and barley, soon? And if not, then why not? Could you also confirm whether the Chinese and Australian ministers of commerce will meet next week? Thank you.

Yang Tao:

Thank you for your questions. As we all know, enterprises remain the mainstay of Chinese-Australian trade. Companies of the two countries independently make business decisions based on demand and market conditions. China has taken inspection, quarantine and trade remedy measures strictly in accordance with the laws and regulations of China and WTO rules. It is obviously inappropriate to misinterpret them as restrictive measures.

Recently, the leaders of China and Australia held a meeting in Bali, Indonesia, charting the course for improving bilateral relations. China is ready to work with Australia to implement the important consensus reached by the two countries' leaders, expand cooperation, manage differences and push forward bilateral economic and trade cooperation based on the principle of mutual respect and mutual benefit. Under a mutual agreement between the two countries, the minister of MOFCOM, Wang Wentao will meet his counterpart, Don Farrell, via video conference next week. The two sides will discuss China-Australia economic and trade relations and economic and trade issues of common concern. Thank you.

SSTV:

Hainan has become a popular tourist spot during the first Spring Festival since the outbreak of the epidemic three years ago. What has been done by the Ministry of Commerce to support the construction of the Hainan Free Trade Port over the last year? What upcoming measures will be taken to build Hainan into the world's most open free trade port? Thank you.

Yang Tao:

Thank you for your questions. The construction of the Hainan Free Trade Port has drawn wide attention. More than two years have passed since the Overall Plan for the Construction of the Hainan Free Trade Port was released. Over the past years, its construction has made smooth progress and the overall development has advanced swiftly but steadily and in an effective and orderly manner. In 2022, the Ministry of Commerce has focused on promoting trade and investment liberalization and facilitation, giving priority to the critical task of launching an island-wide independent customs operation and fully supporting the construction of the Hainan Free Trade Port. Our work mainly includes the following three aspects:

First, working with relevant departments, we have adopted a series of supporting policies and measures to accelerate the development of the Yangpu Economic Development Zone. We have issued documents such as opinions on promoting the high development of foreign culture trade, continuously improved the system of policies concerning trade and investment and advanced the implementation of relevant policies.  

Second, together with Hainan province, we have successfully hosted the second China International Consumer Products Expo, with a large increase in the number of exhibitors, including enterprises and brands, buyer attendance, and professional attendees from the first expo.

Third, we have released the "Report on the Development of Trade and Investment of the Hainan Free Trade Port," fully demonstrating the achievements in trade and investment liberalization and facilitation.

Under the strong leadership of the CPC Central Committee and the State Council, the Ministry of Commerce, together with relevant departments and Hainan province, have worked to achieve positive results in the development of trade and investment in the Hainan Free Trade Port. Last year, utilized foreign investment reached 24.44 billion yuan, up 7.1% year on year. The total trade volume in goods surpassed 200 billion yuan, an increase of 36.8% over the previous year. The open economy has maintained strong momentum for development. During the Spring Festival this year, there was strong demand and sufficient supply in Hainan's consumer market and its culture, tourism and catering sector boomed. All of this demonstrated the vitality of the Hainan Free Trade Port. 

Next, the Ministry of Commerce will fully implement the arrangement of "accelerating the construction of the Hainan Free Trade Port" put forward in the report to the 20th CPC National Congress. Under the coordination and guidance of the leading group on deepening overall reform and opening-up of Hainan province, we will prepare for independent customs operation and conduct pressure tests. At the same time, we will implement relevant policies in the areas of trade and investment, study and formulate the list of goods prohibited and limited from importation and exportation of the Hainan Free Trade Port and host the third China International Consumer Products Expo to promote the development of an open economy in Hainan province and support the development of the Hainan Free Trade Port in constantly making new breakthroughs. Thank you!

Zhonghongwang.com:

What are the plans and considerations of the Ministry of Commerce concerning the work to promote consumption this year? Besides, automobiles are one of the major contributors to consumption, and recently many regions have issued documents to boost the consumption of automobiles. What specific measures is the Ministry of Commerce taking to expand automobile consumption? Thank you.

Xu Xingfeng:

First, thank you for your attention to the work on consumption. It was put forward in the report to the 20th CPC National Congress that we should strengthen the fundamental role of consumption in driving economic growth. According to the Central Economic Work Conference, we should prioritize economic recovery and boost consumption. On Jan. 28, the executive meeting of the State Council came up with clear requirements for the work on consumption. The CPC Central Committee and the State Council have consistently attached great importance to consumption. The Ministry of Commerce will fully implement the decisions and plans of the CPC Central Committee and the State Council and maintain the momentum of consumption demonstrated during the Spring Festival. As mentioned earlier, sales of major retail and catering enterprises in China during the Spring Festival increased by 6.8% over the previous year. At present, we will enhance our work's overall coordination and planning by grounding our efforts in the first quarter and setting our sights for the whole year. Our work will mainly focus on three aspects.

First, we will continue to strengthen the guiding role of policies. We will supervise and inspect the implementation of the policies that have been issued to ensure that these policies are fully implemented. In addition, based on the new situation this year, we will focus on key areas such as automobiles and homes. We will launch a batch of new policies to give full play to the role of policies. 

Second, we will plan major events to unleash market vitality. We have designated this year as the "2023 consumption promotion year," and with a focus on that, we will launch events to promote consumption nationwide. At a press conference on Jan. 19, we briefed you on our plan to organize events for consumption promotion nationwide. With the joint actions of provinces and cities, interactions among regions, and cooperation of relevant associations, we will support businesses and boost market dynamism to promote a series of consumption booms.

Third, we will keep optimizing platforms and carriers to make more progress. Just now, I have talked about cities and the countryside. In urban areas, we will advance the development of international consumption center cities, enhance the supporting role of smart shops and smart business districts, further develop 15-minute radius community life circles to bring more convenience for people, and increase quality supplies through multiple channels. Surely, county-level commerce development is still one of our priorities. Our work generally involves the above three aspects. As a result, we will maintain the momentum established during the Spring Festival and deliver a satisfactory performance regarding consumption work in 2023.

The second question was about automobiles. Automobiles, together with the other three consumer goods categories, account for about a quarter of the total retail sales of consumer goods. Automobile sales account for 10% of the total retail sales of consumer goods. If you buy an automobile, you will consume gasoline. Therefore, sales of automobiles and gasoline together represent nearly 15% of the total retail sales of consumer goods. Therefore, automobiles deserve to be considered the top of the four major consumer goods. In 2022, 26.864 million new vehicles were sold in China, up 2.1% year on year, ranking first in the world for 14 consecutive years. Sales of new energy vehicles were most impressive, with a nearly one-fold increase in domestic sales and a growth rate of 93.4%. Penetration rates of new-energy vehicles reached 25%, accomplishing the national plan's goal three years ahead of schedule. What was the goal of the national plan? According to the development plan for the new energy vehicle industry issued in 2020, by 2025, new energy vehicles would account for 20% of the total sales of new vehicles. However, the proportion has already reached 25.6%, fulfilling the goal three years ahead of schedule.  

As the number one of the four major consumption sectors, automobile sales receive consistent policy support. After MOFCOM issued relevant policies together with 16 other departments, we released information to the public in time. There are three key points to keep in mind. The first point is our easing of restrictions on used car relocation nationwide on Aug. 1, 2022, ensuring the free circulation of all second-hand cars that meet National-V standards. The second point is that on Oct. 1, 2022, the process of reverse invoicing began. Usually, a seller issues an invoice to a buyer, but for used cars, enterprises, as second-hand car buyers, can now issue invoices to individual sellers. The third point is that new measures came into effect on Jan. 1, 2023, to change second-hand car agencies into second-hand car dealers. At the end of last year, more than 40,000 second-hand car dealers were registered, up by 180% on a yearly basis. This demonstrates that our policies have delivered notable results.

Next, we will continue to work with relevant departments to stabilize and expand auto sales. We will roll out multiple measures that cover the whole industrial chain and focus on clear priorities. Our efforts will be focused on the following four areas:

First, we will stabilize new car sales. The country has issued a document to promote the transformation from the administration of purchase to the administration of use, as a limitation on car purchases still exists in some regions. In addition, we will carry out various promotional events to stabilize new car sales growth.

Second, we will support the consumption of NEVs. Just now, I said that good progress was made in NEV sales, which conforms with our goal to achieve carbon peak and neutrality targets. We will guide local authorities to further improve the NEV user experience, from license plate registration to charging and traffic, so that people will have no worries. Imagine the unpleasant experience of taking a long-distance trip and failing to find any charging piles. Therefore, our next step is to improve NEV users' environment.

Third, we will continue to expand the circulation of second-hand cars. The construction and improvement of a nationwide second-hand car information inquiry platform will be accelerated, and the Measures for the Administration of the Circulation of Second-hand Automobiles will be revised. As a result, information about cars will be released more transparently. We aim to create a worry-free atmosphere for second-hand car consumers so that they feel like new car buyers. If the second-hand car you bought had been soaked, burned, or undergone major repairs, and you didn't know about it before purchasing, that would certainly affect your consumption experience. Therefore, we must adhere to our aim and dedicate ourselves to achieving it. Expanding the circulation of second-hand cars will invigorate our vast auto market, with the total number of cars reaching 319 million, and promote sequential consumption in this sector.

Fourth, we will streamline the process of scrapping and trading-in automobiles. As previously mentioned, vehicles have a lifespan. Both brand-new and used cars have limited lifespans and must eventually be scrapped and disassembled. We will revise regulations on scrapping motor vehicles and improve the recycling system. Furthermore, we will encourage regions with suitable conditions to exchange old cars for new ones, thus promoting the circular consumption of cars. 

By creating policy incentives and implementing specific measures, we will maintain a sound environment for auto sales to leverage their role in driving consumption. Thank you.  

China News Service:

In 2022, China's utilized foreign investment expanded by 6.3% year on year, hitting an all-time high. How does MOFCOM view the country's overall performance in attracting foreign investment last year? What do you expect the situation to be this year? Thank you.

Meng Huating:

Thank you for your attention to our work involving foreign investment in China. In 2022, China's attraction to foreign investment was affected by multiple negative factors, such as the spread of COVID-19, slowing global growth, and surging investment protectionism. MOFCOM has resolutely implemented the decisions and plans of the CPC Central Committee and the State Council. It has also worked with other departments and local governments to make solid progress in attracting foreign investment. The volume of foreign investment in China has increased, and its composition and quality have been improved. We have therefore made an active contribution to maintaining stable macroeconomic performance. Throughout the year, China's attraction to foreign investment has shown five features:

First, the scale of foreign investment reached a new record high. On the basis of double-digit growth in 2021, foreign investment continued to maintain stable growth in 2022, and the actual use of foreign investment exceeded 1.2 trillion yuan for the first time as calculated in RMB, with a year-on-year increase of 6.3%, according to comparable standards. If calculated in US dollars, the utilized foreign investment reached $189.13 billion, an increase of 8%, and the scale of investment attraction remained at the forefront of the world.

Second, foreign investment into the manufacturing industry increased significantly. The industry's actual use of foreign capital was 323.7 billion yuan, up 46.1% year on year. In particular, thanks to the lifting of market access restrictions on foreign investment, foreign investment in the automobile manufacturing industry increased by 263.8%. In addition, the attracted investment in computer and communication manufacturing and pharmaceutical manufacturing increased by 67.3% and 57.9%, respectively.

Third, the high-tech industry became an important source of growth. The industry utilized 444.95 billion yuan of foreign investment, up 28.3%, driving the further improvement of the quality of foreign investment. Among them, the investment in the high-tech manufacturing industry and high-tech service industry increased by 49.6% and 21.9%, respectively. In addition to computer and communication manufacturing and pharmaceutical manufacturing mentioned just now, foreign investment in the services for applying scientific and technological achievements, and services for R&D and design also achieved rapid growth, with the growth rate reaching 35% and 26.4% respectively.

Fourth, investments from major sources increased generally. South Korea, Germany, the United Kingdom, and Japan increased their investments by 64.2%, 52.9%, 40.7%, and 16.1%, respectively. Meanwhile, from a regional perspective, investments in China by the EU, countries along the Belt and Road, and ASEAN increased by 92.2%, 17.2%, and 8.2%, respectively.

Fifth, China's eastern, central, and western regions attracted more investment in full force. The actual use of foreign capital in the eastern, central, and western regions increased by 4.7%, 21.9%, and 14.1%, respectively. Among the eastern provinces, Jiangsu province attracted foreign investment of nearly 200 billion yuan; Guangdong province, Shanghai municipality, Shandong province, Zhejiang province, and Beijing municipality each attracted more than 100 billion yuan. Among the central and western provinces, foreign investment in Shanxi, Henan, Guangxi, Hunan, and Shaanxi increased by 229.6%, 119.8%, 49.1%, 41.3%, and 33.6%, respectively. It should be noted that the potential for attracting foreign investment in the central and western regions has been further unleashed.

At present, the situation faced by China in attracting foreign investment is still very complex and severe. World economic growth is sluggish, and various adverse factors are still brewing. A report published by the UNCTAD last month pointed out that global transnational investment will face huge downward pressure in 2023. But at the same time, we are aware that the fundamentals sustaining China's steady and long-term economic growth remain unchanged, and the comprehensive advantage composed of a super-large-scale market, a complete industrial system, rich human resources, and a continuously optimized business environment are being constantly strengthened to attract investment. The majority of foreign investors still have a strong desire to invest in China. We are confident that we will continue to achieve new great results in attracting foreign investment in 2023, promote the "quantity" growth and "quality" improvement of foreign investment, and better help to foster a new development pattern and promote high-quality development. Thank you!

Bloomberg: 

At the end of December, MOFCOM announced a "request for comments" on looking to restrict the export of manufacturing technology for solar cells, amongst other things. Can you provide more details about this effort? And can you also explain how this is different from the US's looking to restrict exports of technology to manufacturers of semiconductors? Thank you.

Yang Tao:

First of all, thank you for your questions. There is a deviation in your understanding of the restrictions on the export of solar cell production technology. Recently, in accordance with the Foreign Trade Law of the People's Republic of China and the Regulations on the Administration of Technology Import and Export of the People's Republic of China, MOFCOM and the Ministry of Science and Technology revised the catalog of technologies that are subject to export bans or restrictions and publicly solicited opinions. Currently, we are sorting out the opinions and suggestions we have collected and will carefully study them along with relevant departments. Next, we will continue to uphold open cooperation, constantly optimize the business environment of technology trade, and promote global technology trade exchanges and cooperation. Thank you.

Red Star News:

Over the past year since the RCEP agreement entered into force, dividends have started to emerge, and all parties have paid close attention to this. What achievements have been made since the RCEP agreement entered into force in 2022? Thank you.

Guo Tingting:

Thank you for your question. Let me take this question. The Regional Comprehensive Economic Partnership agreement, also known as the RCEP agreement, entered into force on Jan. 1, 2022. MOFCOM firmly implements the decisions and arrangements of the CPC Central Committee and the State Council. Together with relevant departments, we have applied and fulfilled the rules and market access commitments of RCEP and promptly issued the guiding opinions on the high-quality implementation of the RCEP to guide and support local governments, industries, and enterprises to seize opportunities and expand trade and investment cooperation with RCEP members. Positive results have been achieved, which are mainly reflected in:

First, the agreement played a powerful role in the development of trade and investment. From the perspective of trade, the total import and export between China and other RCEP members reached 12.95 trillion yuan in 2022, up 7.5% year-on-year, accounting for 30.8% of China's total foreign trade. In particular, China's import and export with eight of the members grew by double digits. From the perspective of two-way investment, in 2022, China's non-financial direct investment in other RCEP members was $17.96 billion, up 18.9%, while China attracted their direct investment of $23.53 billion, up 23.1%. The growth rate of two-way investments was higher than the overall level.

Second, local governments have achieved initial progress in aligning policies with the RCEP agreement. MOFCOM offered them comprehensive guidance and support in this regard. We organized 10 training sessions nationwide along 10 themes, with a total attendance of more than 400,000. We upgraded the free-trade zone public services platform, helping local governments and enterprises make full use of tariff reductions and cumulative rules of origin under the RCEP, seize the opportunities for trade and investment liberalization and facilitation, and deepen cooperation on industrial and supply chains with other participating countries. Some local governments have taken the active implementation of RCEP encouraging obligations as leverage to optimize the business environment. They have worked to build high-level open cooperation demonstration zones for RCEP and attract industries, capital, and talent, thus significantly improving the local trade and investment climate.

Third, enterprises enjoyed tangible benefits of the agreement. The implementation of the RCEP agreement, combined with previous bilateral free trade agreements that China signed with other participating countries, has delivered more benefits to enterprises. In 2022, Chinese export companies applied for a total of 673,000 RCEP certificates of origin and declarations of origin worth 235.3 billion yuan, with an estimated 1.58 billion yuan in tariff reductions from importing countries. Chinese companies benefited from an estimated 1.55 billion yuan in tariff reductions for the import of products worth 65.3 billion yuan.

Fourth, participating countries worked together to enhance the outcomes of the agreement. China actively promoted the ratification of the agreement by more countries through mechanisms such as RCEP ministerial meetings and joint committees. South Korea, Malaysia, and Indonesia, among other countries, have already rectified and implemented the agreement. At the same time, we closely cooperated with other RCEP members to promote the implementation of tax reduction obligations and facilitation measures, optimize the regional business environment, and enhance the outcomes of the agreement.

In the next step, MOFCOM will continue to ensure high-quality implementation of RCEP, advance the continuous release of its dividends, and give full play to the positive role of RCEP in ensuring stable performance in foreign trade and investment, promoting cooperation on industrial and supply chains, and driving high-quality development. At the same time, we will work with other RCEP members to promote the full and effective implementation of the agreement for all signatory countries, strengthen mechanism development, and provide a strong guarantee for the steady and sustained progress of RCEP. Thanks!

The Poster News APP:

Under the current situation, what favorable factors does China have in attracting foreign investment? What specific measures will be taken to maintain the current level of foreign investment, expand its quantity, and improve its quality? Thanks!

Meng Huating:

Thank you for your questions. As was introduced just now, under the joint efforts of all parties, we have achieved remarkable progress in attracting foreign investment in 2022, which laid a good foundation for relevant work in 2023. There are still many favorable factors for China to attract foreign capital. They can be summarized as the following four aspects:

First, the outlook for China's economic growth is promising. The fundamentals of the Chinese economy — its strong resilience, enormous potential, great vitality, and long-term sustainability — remain unchanged. The 20th CPC National Congress made a strategic deployment for China's economic development both in the immediate future and for some time to come, and the Central Economic Work Conference put forward clear requirements for promoting the overall improvement of economic performance this year. All localities and departments are actively devising measures to implement the deployment and requirements so as to achieve the goal of "ensuring steady growth and keeping employment and prices stable." Recently, a number of international organizations have raised their forecasts for China's economic growth this year. Economic growth means investment opportunities. Recent surveys by relevant institutions showed that most foreign-funded enterprises are very confident in China's economic outlook this year. Investors' confidence is our greatest strength in work.

Second, the Chinese market is becoming a stronger magnet for foreign capital. According to statistics from MOFCOM, more than 90% of foreign-funded enterprises in China are mainly targeting the Chinese market. With a population of more than 1.4 billion, China is the second-largest consumer market in the world. New forms and models of consumption continue to emerge, further unlocking the market potential. The Central Economic Work Conference required that the country prioritize the recovery and expansion of consumption this year. The market size will be further expanded, and foreign investors will have more motivation to invest in China.

Third, the synergy building through various policies is more evident. Since last year, MOFCOM, together with relevant parties, has issued the new Catalogue of Encouraged Industries for Foreign Investment and introduced a series of special policies to promote investment in manufacturing and encourage the development of foreign-invested R&D centers. This year, we will vigorously promote the implementation of these policies and introduce another batch of policies and measures according to the deployment of the central leadership. The synergy of existing and new policies will bring more sense of gain to foreign-funded enterprises.

Fourth, cross-border exchanges are more convenient. In the past three years, the pandemic impeded the cross-border flow of people and logistics, which was the most prominent problem encountered by foreign investors. Now, as China has entered a new phase of COVID-19 response, cross-border exchanges are becoming normalized. As you may have noticed, many local governments have recently organized activities overseas to attract foreign investment. It is believed that more foreign-funded projects will be implemented in China this year.

These are some favorable factors for attracting foreign capital. Now, I will briefly introduce our specific measures in 2023.

The 20th CPC National Congress and the Central Economic Work Conference made a series of important arrangements for promoting high-standard opening-up and making greater efforts to attract and utilize foreign investment. In the next step, we will resolutely implement the deployment of the central leadership and make every effort to deliver a satisfactory performance.

In terms of boosting newly-added foreign investment, we will work to cut the negative list for foreign investment in a reasonable manner and further expand opening-up in the modern service sector. Based on major economic and trading expos and various investment promotion mechanisms, we will support all localities to attract investment by combining the strategies of "going global" and "bringing in" and see that more iconic foreign investment projects are implemented.

In terms of stabilizing existing foreign investment, we will continue to leverage the role of the special task force for key foreign-funded projects under the foreign trade and investment coordination mechanism. We will strengthen regular communication with foreign-invested enterprises and foreign chambers and associations of commerce, help solve difficulties facing enterprises, and ensure national treatment for all foreign-invested enterprises. We will also improve the interdepartmental coordination mechanism of all levels for solving complaints from these enterprises and protect their rights and interests in accordance with the law so as to ensure the sound operation and development of existing foreign-invested enterprises.

In terms of improving the quality of foreign investment, we will work to communicate and implement a series of related policies and encourage localities and related government bodies to roll out detailed supporting measures. We will proactively guide more overseas investment towards sectors such as advanced manufacturing, modern services, energy conservation and environmental protection, and sci-tech innovation and toward the central, western, and northeastern regions. We will keep scaling up the efforts to attract investment in high-tech industries and continuously improve the quality and standard in attracting foreign investment.

Thank you.

Shou Xiaoli:

The commerce work has attracted much attention as many journalists still have questions to ask. Due to time limits, we will have two last questions.

Tianmu News:

Regarding the "going global" strategy mentioned earlier, since the second half of last year, many local foreign trade enterprises have been taking overseas group trips to boost business orders, which fostered a strong atmosphere of expanding the market. What efforts will MOFCOM make this year to boost trade? What kind of assistance or guidance will MOFCOM provide to foreign trade enterprises? Thank you.

Li Xingqian:

Thank you for your questions. In the fourth quarter of last year, MOFCOM and another five government departments rolled out policy measures to ensure unimpeded channels for foreign trade enterprises to boost business orders. All localities have proactively supported these enterprises to take overseas group trips, participate in expos, visit clients, and seek business opportunities. As a result, the foreign trade sector has sprung to life. Foreign trade businesses have their own features, and an in-person meeting often works better than thousands of emails. Our foreign trade enterprises are looking forward to taking their samples and designs to the global market and bringing in business orders and clients.

In 2023, the global economic and trading situation has grown extremely challenging, and the downward pressure mounted markedly. The major problem facing China's foreign trade has turned from impeded supply chains and insufficient order delivery capacity last year to weak global demand and a drop in the number of orders this year. This is a crucial change. MOFCOM has specified that strengthening the enabling role of trade and building closer connections between supply and purchasing will be put high on the agenda. It will also ramp up efforts to support our foreign trade enterprises to boost business orders and expand the market. Specifically, we will work on the following four aspects concerning foreign trade enterprises.

First, in-person expos will be resumed. We will carry out the decisions made by the State Council executive meeting on Jan. 28 and work to fully resume in-person trade fairs and expos domestically. We will ensure the success of a series of well-known events such as the China International Import Expo, the Canton Fair, and the China Hi-tech Fair.

Second, new business forms will be better explored. We will promote the further growth of new business forms that have seen rapid development in recent years, such as cross-border e-commerce and overseas warehouse. We will also give full play to digital measures to unlock trade potential and boost exports from micro, small, and medium-sized foreign trade enterprises.

Third, we will tap new demand. MOFCOM will give full play to the role of the economic and commercial offices of Chinese embassies and consulates overseas and assist local governments in organizing enterprises to carry out trade cooperation abroad. We need to strengthen research on international market segmentation, share supply and demand information in various markets in a timely manner, and help companies obtain foreign trade orders in time.

Fourth, we will support enterprises to "go global." MOFCOM will provide more convenience for foreign trade enterprises to carry out cross-border business exchanges, encourage enterprises to promote Chinese products, Chinese manufacturing, and Chinese brands in various ways, and support qualified local governments to expand their overseas exhibitions. Thank you!

Hong Kong Bauhinia Magazine:

What new progress and achievements have been made in terms of Belt and Road economic and trade cooperation in 2022? How will it advance this year? Thank you.

Yang Tao:

Thank you for your questions. Since the Belt and Road Initiative (BRI) was put forward more than nine years ago, MOFCOM has conscientiously implemented the decisions and plans of the CPC Central Committee and the State Council and continuously deepened the economic and trade cooperation along the Belt and Road, which has effectively promoted mutual benefit and win-win cooperation with the partner countries, and provided important support for the high-quality development of the BRI. During the previous year, thanks to the joint efforts of all parties, the Belt and Road economic and trade cooperation has taken new steps, and the results are mainly reflected in the following four aspects:

First, trade and investment grew rapidly. In 2022, China's trade with countries along the Belt and Road hit a record high, with the volume of trade in goods reaching 13.8 trillion yuan, a year-on-year increase of 19.4% and 11.7 percentage points higher than the overall growth rate. The two-way investment between China and Belt and Road countries also reached a new level, covering multiple industries. Among them, the non-financial direct investment in the countries along the Belt and Road was 141.05 billion yuan, and the actual investment in China by the countries along the Belt and Road was 89.15 billion yuan, a year-on-year increase of 7.7% and 17.2%, respectively, which are 0.5 percentage point and 10.9 percentage points higher than the overall growth rate, respectively.

Second, project construction achieved solid and effective results. In 2022, China's newly signed contracted projects in countries along the Belt and Road were valued at 871.84 billion yuan, with a turnover of 571.31 billion yuan, accounting for 51.2% and 54.8% of its total contracted projects there, respectively. Steady progress was made in the construction and operation of key projects such as the China-Laos railway and the Hungary-Serbia railway, and a number of "small but beautiful" livelihood projects involving agriculture, medical care, and poverty reduction were implemented one after another. Overseas economic and trade cooperation zones were upgraded. By the end of 2022, the cooperation zones built by Chinese companies in countries along the Belt and Road had seen an investment of 397.9 billion yuan in total, creating 421,000 local jobs. More than 16,000 trips were operated by China-Europe Railway Express throughout the year, a year-on-year increase of 9%. The construction of new land-sea transit routes opened a new chapter. A China-Singapore cooperation plan on jointly building the New International Land-Sea Trade Corridor was implemented. These high-quality cooperation projects have effectively promoted the economic and social development of the host countries and brought a real sense of fulfillment to the local people.

Third, cooperation has been continuously expanded. Cooperation in the fields of new energy, energy conservation, environmental protection, and new infrastructure construction boomed. In 2022, China signed 31 memorandums of investment and cooperation involving green development, the digital economy, and the blue economy with relevant countries, creating more development opportunities for Belt and Road cooperation. The Silk Road e-commerce circle of friends continues to expand and the number of our partner countries that have established bilateral e-commerce cooperation mechanisms has increased to 29. In addition, special e-commerce activities such as online shopping festivals featuring quality African products and "Buy at BRICS" online promotion events have become new highlights of the cooperation.

Fourth, mechanisms and platforms have been well improved. We actively leveraged the role of multilateral and bilateral economic and trade mechanisms, deepened communication and alignment, and established 12 new cooperation mechanisms for trade, investment, and trade in services with relevant countries. Key cooperation such as the "nine programs" of China-Africa cooperation and the demonstration zones jointly built with ASEAN countries for economic innovative development was advanced in an orderly manner. China-ASEAN Expo, China-Eurasia Expo, China-Central Asia Economic and Trade Cooperation Forum, China-Latin America Infrastructure Cooperation Forum , and other exhibition forums were successfully held.

This year marks the 10th anniversary of the Belt and Road Initiative. MOFCOM will thoroughly implement General Secretary Xi Jinping's important instructions and guiding principles on Belt and Road cooperation, implement the decisions and plans of the CPC Central Committee and the State Council in a solid way, deepen unimpeded trade, tap new potentials of investment and cooperation, improve quality and efficiency, and make new contributions to high-quality development of the BRI! Thank you!

Shou Xiaoli:

Thank you to Ms. Guo, our speakers, and also to all the friends from the media. That's all for today's press conference.

Translated and edited by Wang Yiming, Wang Qian, Xu Xiaoxuan, Zhang Rui, Cui Can, Zhang Junmian, Qin Qi, Liu Sitong, Xu Kailin, Ma Yujia, Li Xiao, Zhang Liying, Li Huiru, Zhu Bochen, Liu Qiang, Yan Bin, Wang Wei, David Ball, Tom Arnsten, and Jay Birbeck. In case of any discrepancy between the English and Chinese texts, the Chinese version is deemed to prevail.

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Read in Chinese

Speakers:

Mr. Zhao Chenxin, vice chairman of the National Development and Reform Commission (NDRC)

Mr. Xin Guobin, vice minister of industry and information technology

Mr. Liu Guohong, vice minister of natural resources

Mr. Zhao Yingmin, vice minister of ecology and environment

Chairperson:

Ms. Xing Huina, deputy director general of the Press Bureau of the State Council Information Office (SCIO) and spokesperson of the SCIO

Date:

Jan. 19, 2023

Xing Huina:

Friends from the media, good morning. Welcome to this press conference held by the State Council Information Office (SCIO). Today, the SCIO released a white paper titled "China's Green Development in the New Era," and organized this press conference to introduce and interpret its main content.

The white paper fully implements Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era and the guiding principles of the 20th National Congress of the Communist Party of China (CPC), and presents a comprehensive picture of China's work to apply the new development philosophy and its major decisions, achievements, and experience in green development since the 18th CPC National Congress. The white paper introduces China's efforts and progress in promoting the modernization of harmony between humanity and nature and its ideas, actions, and contributions regarding actively participating in global environment governance and efforts to respond to climate change.

At around 18,000 Chinese characters, the white paper consists of a preface, a main body, and a conclusion. The main body is divided into seven parts: "Staying Firmly Committed to Green Development," "A Basic Green Territorial Configuration Is in Place," "Adjusting and Improving the Industrial Structure," "Extensive Application of Green Production Methods," "Eco-Friendly Living Becomes the Prevailing Ethos," "Improving the Institutions and Mechanisms for Green Development," and "Building the Earth into a Beautiful Home." The white paper is published in eight languages - Chinese, English, French, Russian, German, Spanish, Arabic, and Japanese - by the People's Publishing House and the Foreign Languages Press. It is available at Xinhua Bookstores across the country.

To help you gain a full and accurate understanding of the white paper, we have invited Mr. Zhao Chenxin, vice chairman of the National Development and Reform Commission (NDRC); Mr. Xin Guobin, vice minister of industry and information technology; Mr. Liu Guohong, vice minister of natural resources; and Mr. Zhao Yingmin, vice minister of ecology and environment, to brief you on relevant information and then take your questions.

Now, I'll give the floor to Mr. Zhao Chenxin for his introduction.

Zhao Chenxin:

Friends from the media, good morning. It's my great pleasure to attend today's press conference and introduce the white paper "China's Green Development in the New Era" together with several leaders of relevant departments.

I've got the white paper and let me show it to you.

Since the 18th CPC National Congress, the CPC Central Committee with Comrade Xi Jinping at its core has attached great importance to ecological conservation and made a series of major deployments, leading to significant achievements in China's green development. With rich content and clear focus, the white paper "China's Green Development in the New Era" systematically summarizes China's actions and achievements in green development over the past decade, and expounds the country's ideas and experience of green development. 

Ms. Xing introduced the structure of the white paper just now. Here I would like to briefly explain its main content from three perspectives.

First, the white paper elaborates on the underlying philosophy of China's green development in the new era.

The first is applying a people-centered development philosophy. China has taken a sound eco-environment as the most inclusive public benefit, vigorously promoted eco-friendly ways of work and life, and improved the quality of the environment and ecosystems so as to help people feel happier, more satisfied, and more secure.

The second is focusing on sustainable development in China. China has treated lucid waters and lush mountains as invaluable assets and firmly pursued a green and low-carbon path to development to enhance economic, ecological, and social benefits.

The third is applying systems of thinking and a coordinated approach. China has striven to maintain a balance between development and protection, between overall and local interests, and between the present and the future. The country has worked to coordinate industrial restructuring, pollution control, eco-environmental conservation, and climate response. It has endeavored to cut carbon emissions, reduce pollution, expand green development, and pursue economic growth.

The fourth is working together for global sustainable development. China has upheld the vision of a human community with a shared future, always been a major participant, contributor, and torchbearer in the global movement for building an eco-friendly civilization, and contributed its wisdom and strength to global sustainable development.

Second, the white paper systematically summarizes China's actions and achievements in green development in the new era.

The first is a sustained and steady improvement in the eco-environment. During the decade (from 2012 to 2021), 64 million hectares of trees were planted, desertification prevention and control was carried out over 18.53 million hectares of land, and 40 million hectares of land were improved through sowing grass, and more than 800,000 hectares of wetland were added or restored. China has steadily increased areas of forests, grasslands, wetlands, rivers, and lakes, and effectively reversed the trend of desertification. The quality of the environment has significantly improved. The average PM2.5 density of China's cities at the prefecture level and above dropped from 46 micrograms per cubic meter in 2015 to 30 micrograms per cubic meter on 2021. On 87.5% of the days in 2021, people enjoyed a good air quality. In 2021, the proportion of surface water at or above Grade III in the country's five-tier water quality system reached 84.9%. All these were major changes.

The second is a considerable increase in the quality of economic growth. Strategic emerging industries have become a key driver for economic development. The value-added output of high-tech manufacturing in 2021 accounted for 15.1% of that of industries above the designated size, up 5.7 percentage points from 2012. China's green industries are booming. China leads the world in the manufacture of clean energy generation facilities. In 2021, the output value of China's energy conservation and environmental protection industries exceeded 8 trillion yuan. 

The third is the extensive application of green production methods. China has advanced the comprehensive green transformation of the manufacturing, agriculture, and service sectors, improved the energy mix, fostered a greener and low-carbon way of transportation, and significantly increased efficient resource utilization. The proportion of clean energy sources in total energy consumption increased from 14.5% in 2012 to 25.5% in 2021, and the proportion of coal decreased from 68.5% to 56% over the same period. China's average annual economic growth of 6.6% has been supported by an average annual growth of 3% in energy consumption, and the per unit GDP energy consumption dropped by 26.4%. China is among the countries with the fastest reduction in energy intensity.

The fourth is the active promotion of eco-friendly living. China has worked to raise public awareness of conserving resources and protecting the environment, and advocated a greener and low-carbon lifestyle, creating a conducive social atmosphere for jointly promoting green development.

The fifth is further improvement in institutions and mechanisms. China has strengthened the rule of law, tightened supervision and management, and improved market-based mechanisms, thus providing a solid guarantee for its green development.

Third, the white paper offers with a large number of facts on China joining hands with the rest of the world to build the Earth into a beautiful home.

The Earth is our one and only home, and a beautiful homeland is the shared aspiration of mankind. China has actively participated in global climate negotiations in a constructive manner, and made historic contributions to the conclusion and implementation of the Paris Agreement. China is also an active participant in the South-South cooperation on climate change. The country endeavors to build a green Belt and Road and carries out extensive green international cooperation. In doing so, China is working with the international community to advance sustainable development worldwide.

China will keep to the path of green development, promote the modernization of harmony between humanity and nature, and work with other countries to build a cleaner and more beautiful world.

That's my introduction to the key points of the white paper. Now, my colleagues from relevant departments and I are ready to answer your questions. Thank you.

Xing Huina:

Thank you, Mr. Zhao, for your introduction. Now we will open the floor for questions. Please identify the media outlet you represent before raising questions.

The Paper:

Low-carbon energy is the key to reducing air pollution and controlling greenhouse gas emissions. In the past 10 years, how has China coordinated energy security and green and low-carbon transformation and accelerated the building of a clean, low-carbon, safe, and efficient energy system? Thank you.

Zhao Chenxin:

Thank you for your question. You raised a very good question. Indeed, human beings cannot survive and develop without energy. To achieve green development, we must vigorously reform how we produce and utilize energy. In the 10 years of the new era, China has accelerated the reform of energy production and utilization, continuously enhanced energy security capabilities, and promoted the substantial improvement of green and low-carbon levels, providing critical support for the realization of high-quality economic and social development. I will briefly introduce it from several aspects.

First, we have strengthened the ability to guarantee energy supply. We are committed to maintaining energy security and have developed a diverse energy production system that includes coal, oil, gas, electricity, nuclear, and renewable energy. Recent data from the National Bureau of Statistics and the National Energy Administration (NEA) shows that the supply of raw coal, crude oil, natural gas, and electricity in China has grown steadily, with improved quality, in recent years. At a press conference of the SCIO two days ago, Lian Weiliang, vice chairman of the NDRC, and Zhang Jianhua, administrator of the NEA, elaborated on this topic, so I won't go into details on this aspect. Through these efforts, we have ensured high-quality energy production growth, effectively guaranteeing national energy security.

Second, we have vigorously promoted renewable energy. The capacity of wind and photovoltaic power generation has continued to grow. Wind and solar energy are gradually becoming the dominant source of newly installed capacity and power generation. At the end of 2022, the national installed capacity of wind and photovoltaic power reached over 700 million kilowatts, and the installed capacity of wind power and photovoltaic power generation ranks first in the world. In 2022, the newly installed capacity of wind and photovoltaic power made up 78% of the country's newly installed capacity, and newly added wind and photovoltaic power generation accounted for more than 55% of the country's new power generation in that year - a significant proportion. We have taken many measures to implement the full guarantee purchase system for renewable energy power generation and have also been carrying out a weighted assessment of our renewable energy power consumption responsibility. The utilization efficiency of renewable energy has been significantly improved.

Third, we have focused on enhancing the efficient and clean utilization of fossil fuels. We advanced coal industry supply-side reforms and implemented green mining. Also, we transformed coal power plants to ultra-low emission and energy-saving standards. By the end of 2021, over 1 billion kW of coal-fired generating units have achieved ultra-low emissions nationwide, and nearly 900 million kW have undergone energy-saving renovations. We encouraged the substitution of coal with natural gas, electricity, and renewable energy and promoted clean end-use energy. We also carried out special actions to upgrade refined oil quality to an internationally advanced level. Furthermore, we accelerated the phasing out of high-emission and old vehicles to reduce pollution emissions effectively.

Ensuring energy security and promoting a green, low-carbon transformation while accelerating the development of a clean, efficient, and safe energy system is a crucial and long-term objective that must be upheld. Building on our current efforts, we will continuously strive to fully implement the guiding principles of the 20th CPC National Congress and further advance the energy revolution, providing strong support for a green and low-carbon transformation of the economy and society. Thank you.

Hong Kong Economic Herald:

The report of the 20th CPC National Congress proposed to move the manufacturing sector toward higher-end, smarter, and greener production and made a series of important arrangements for the transition to green development. What developments have been made in the green and low-carbon transformation of China's industry and information technology in the new era? Thank you.

Xin Guobin:

Thank you for your question. The 20th CPC National Congress made important arrangements for promoting the green development of the manufacturing sector, and further pointed out the direction for the green and low-carbon transformation of the industrial and information industry. Since the 18th CPC National Congress, we have conscientiously implemented Xi Jinping Thought on Ecological Civilization, applied the new development philosophy in full, the right way and all fields of endeavor, and adopted a series of policy measures, all resulting in significant progress.

First, the restructuring of the industrial sector has seen notable results. Traditional manufacturing is undergoing rapid optimization and adjustment. During the 13th Five-Year Plan period (2016-2020), China removed more than 150 million tons of excess steel production capacity and about 300 million tons of excess cement production capacity. Substandard steel products have been eliminated. The advanced manufacturing industry continues to grow and develop. The value-added output of high-tech and equipment manufacturing in 2021 accounted for 15.1% and 32.4% of that of industries above the designated size, up 5.7 and 4.2 percentage points from 2012, respectively.

Second, energy resource utilization efficiency continues to improve. All stakeholders are actively promoting industrial energy conservation and reduction. In 2021, the comprehensive energy consumption per unit of products such as steel, electrolytic aluminum, cement clinker, and flat glass was reduced by more than 9% compared to 2012, and the coal consumption per kilowatt-hour of thermal power units nationwide decreased to 302.5 grams of standard coal, both leading the world. At the same time, resource utilization is being actively pursued. According to preliminary estimates, in 2021, the total utilization of bulk industrial solid waste was approximately 2.1 billion metric tons, with a utilization rate increase of nearly 10 percentage points compared to 2012. The impact has been substantial.

Third, the green supply capacity has been significantly enhanced. Efforts were made to fortify the low-carbon and green industrial chain, reinforce the industrial foundation, and drive key technological advancements. The mega-kilowatt hydropower generator set is now operating and generating power. China produces more than 70% of the global total of polysilicon, wafers, cells, and modules. Green transformation of transportation was actively promoted. The production and sales of new energy vehicles have ranked first globally for eight consecutive years, and the output of such vehicles is expected to surpass 7 million in 2022. The global market share of green shipping using LNG and methanol has approached 50%. Green building materials have been successfully promoted and used in urban and rural areas, especially going down with rural residents.

Fourth, a coordinated digital and green transformation has been enhanced. The integration and advancement of digital tech and manufacturing have increased. The digital control rate of key processes in key areas increased from 24.6% in 2012 to 55.3% in 2021. Efforts were made to optimize the energy efficiency of new infrastructure. Currently, the average energy consumption of a 5G base station has decreased by over 20% from its initial commercialization stage, and 153 national green data centers have been established. The average PUE of large and above data centers planned and under construction nationwide has decreased to 1.3.

Next, we will conscientiously implement the guiding principles of the 20th CPC National Congress and work to maintain harmony between humanity and nature in our development. We'll actively promote peak carbon emissions in the industrial sector and build a green and low-carbon tech system as well as a green manufacturing support system. We aim for industrial transformation and development toward a high-end industrial structure, low-carbon energy consumption, circular resource utilization, clean production processes, digital manufacturing, and green product supply.

Thank you.

CCTV:

In recent years, green industries have attracted wide attention and become a new driving force in economic growth. What measures has China taken to develop green industries, and how are they going so far? Thank you. 

Zhao Chenxin:

Thank you for your questions. To vigorously develop green industries and cultivate a new, green driving force in development is an important approach to accelerating the transition to a green development model. In the past decade, various localities and departments across China have worked on resource conservation and environmental protection, which have in turn promoted the development of green industries. Here are some facts about our progress: 

First, we have strengthened ecological and environmental protection and created massive market demand. Since the 18th National Congress of the Communist Party of China, we have made solid gains in the battle against pollution, enhanced ecological protection and restoration, promoted the green transition of traditional industries and upgraded them, and vigorously developed clean energies, providing key development opportunities for green industries. With the rollout of policies aimed at carbon emissions peak and carbon neutrality, green industries have grown at an even faster pace. In recent years, the output of energy conservation and environmental protection industries and new energy industries has grown at an annual average rate of over 10%, with China leading the world in the manufacture of clean energy-generation facilities. And as Minister Xin just said, China's output and sales of new energy vehicles have topped the world for eight consecutive years. 

Second, we have utilized all kinds of policy tools to incentivize and encourage the development of green industries. With the use of fiscal policies, tax, price, and other measures, various departments have worked together to support the development of green industries. In the past 10 years, more than 100 billion yuan in central government budget has been allocated to support the construction of environmental infrastructure. During the 13th Five-Year Plan period (2016-2020), the central government allocated nearly 200 billion yuan in ecological protection subsidies annually. More than 50 tax and fee preferential policies have been implemented, and the resource and environment pricing mechanism has been constantly improved. We have also set up a system of green product assessment standard, ramped up green government procurement, and encouraged the consumption of green products. 

Third, we have strengthened innovation in green technologies and promoted the industrial application of green technologies. China has constantly ramped up sci-tech innovation. At the end of 2021, the number of in-force invention patents in China's energy conservation and environmental protection industries and new energy industries stood at 49,000 and 60,000, respectively, which were 1.6 and 1.7 times from the end of 2017, demonstrating relatively rapid development. A green technology equipment manufacturing system covering energy conservation, water conservation, environmental protection, renewable energy, and other areas has been formed. In addition, technologies in new energy, pollution control, and environment monitoring have become advanced by international standards, and technologies have increasingly led the development of industries. 

Fourth, we have robustly developed green finance to provide financial support for green industries. We have improved green finance policies and promoted the establishment of a multilevel green finance product and market system. At the end of 2021, China's green loan balance in RMB and foreign currencies stood at 15.9 trillion yuan, and its outstanding green bonds stood at 1.1 trillion yuan, both ranking among the largest in the world.

Green industries have become a new driver of economic growth and are demonstrating their sound momentum. The development of green industries requires attention and support from all sides. From the government side, we will ramp up policy guidance and promotion and keep lending support to green industries in order to promote their sound and sustained development. Thanks.

China Daily:

Over the years, we have seen environmental conditions becoming better and better. There are more lucid waters and lush mountains, and humanity and nature coexist in perfect harmony. I wonder, what has been done in the area of ecological and environmental protection to build beautiful homes featuring harmony between humanity and nature and accelerate green and low-carbon development? What has been achieved so far? And what measures will be taken next? Thank you. 

Zhao Yingming:

Thank you for your questions. Making eco-environmental progress and strengthening ecological and environmental protection should not only meet people's growing desire for a beautiful environment but also promote high-quality development as well as green and low-carbon development. With the sound guidance of Xi Jinping Thought on Ecological Civilization, we moved from firmly deciding to battle pollution to working on pollution control and making further progress in the battle against pollution. The past decade has witnessed unprecedented measures, efforts, and achievements in China's ecological and environmental protection. In summary, there are four key areas of work in building beautiful homes featuring harmony between humanity and nature and achieving green and low-carbon development. 

First, we have worked to resolve prominent ecological and environmental problems. We have adopted a targeted, scientific, and law-based approach to curb pollution; further addressed air, water, and soil contamination; and continued to improve China's ecology and environment. The average PM2.5 density in China's cities at prefecture level and above dropped from 46 micrograms per cubic meter in 2015 to 29 micrograms per cubic meter in 2022. China has made the fastest progress in air quality improvement in the world. Last year, the proportion of surface water at or above Grade III in the country's five-tier water quality system reached 87.9%. China has also effectively brought the threat of soil contamination under control and banned the import of foreign waste, fulfilling its goal of "zero import" of solid waste. We have also ramped up efforts to protect and restore ecosystems and made solid gains in biodiversity protection. Thus, the Chinese people have a stronger sense of gain, happiness, and security in terms of ecology and environment. 

Second, we have taken active steps to advance the Beautiful China Initiative. A series of measures have been adopted to strengthen environmental protection and build a beautiful China. Major strategies for regional development have been implemented concerning the Beijing-Tianjin-Hebei region, the Yangtze Economic Belt, the Guangdong-Hong Kong-Macao Greater Bay Area, the Yangtze River Delta, and the Yangtze River basin and Yellow River basin. Joint protection of the regional eco-environment and joint prevention and control of pollution have been strengthened. Hubs for green development and pilot zones for building a beautiful China have been established. Coordinated efforts have been made to promote innovation demonstrations in key areas. The first branch of 18 beautiful rivers and lakes and eight beautiful bays have been built. The construction of "zero-waste cities" has been launched in 113 cities at and above the prefecture level and eight special areas. Demonstration initiatives have been launched for eco-environmental progress. Currently, 468 national demonstration zones for eco-environmental progress and 187 practice and innovation bases for turning natural resources into economic gains have been established, vividly demonstrating various examples of a beautiful China.

Third, we have made extensive efforts to advance green and low-carbon development. The pursuit of synergy in reducing pollution and carbon emissions has been taken as a key task in promoting green transition in all respects of economic and social development and the Implementation Plan on Pursuing Synergy in the Reduction of Pollution and Carbon Emissions has been published and implemented. Pollution prevention has been strengthened at the source. The region-specific environmental management system of "three lines and one list" (i.e., enforcing red lines for ecological conservation, setting the threshold for environmental quality, imposing a ceiling on resource utilization, and implementing a negative list of environmental standards for market access) has been implemented. Environmental impact assessments and management have been further advanced. Moreover, strict environmental standards for project approval have been enforced. Synergy in reducing pollution and carbon emissions has been promoted in key fields such as industry, transportation, urban and rural construction and agriculture. Adjustment and improvement in industrial structures, the energy mix and transportation structure have been advanced. Construction has begun on the first collaborative innovation zone to reduce pollution and carbon emissions. The Environmental Code of Conduct for Citizens (for Trial Implementation) was published, and a green and low-carbon lifestyle has been strongly advocated.

Fourth, China has fully engaged in global environmental governance. China successfully hosted the 15th Meeting of the Conference of the Parties to the Convention on Biological Diversity. The U.N. biodiversity deal, entitled the Kunming-Montreal Global Biodiversity Framework, was adopted in the second phase of the meeting earlier. Serving as the host of the COP15 is the first time China has held the presidency of an important international environmental convention and facilitated negotiations and the adoption of agreements among international communities. It is also a new practice for China to take a leading role in global environmental governance. China has worked to bring about positive results at the 27th Meeting of the Conference of the Parties to the United Nations Framework Convention on Climate Change, promoted green development under the Belt and Road Initiative, and launched the Belt and Road Initiative International Green Development Coalition (BRIGC) and the BRI Environmental Big Data Platform. Pragmatic measures have been adopted to carry out multilateral and bilateral environmental cooperation, and active steps have been taken to promote South-South cooperation on ecological conservation and climate response, making positive contributions to maintaining sustainable global development. 

Next, we will thoroughly study and implement the guiding principles of the 20th CPC National Congress and aim to build a beautiful China. We will coordinate industrial restructuring, pollution control, eco-environmental conservation, and climate response. We will take coordinated steps to cut carbon emissions, reduce pollution, and expand green development, while pursuing economic growth. We will promote high-quality development and a high-quality life through high-level environmental protection and make great efforts to achieve Chinese modernization based on harmony between humanity and nature. Thank you.

Changjiang Daily:

With a large population, China has long faced the problem that land resources fail to satisfy the needs of the population in the process of advancing modernization. Faced with such a reality, what measures will be adopted to coordinate the development and protection of land to promote the green transformation of China's growth model and achieve sustainable development? Thank you.  

Liu Guohong:

Thanks to this reporter for the questions. As is known to all, China's basic national condition is that it has a large population but limited land resources. Therefore, to achieve sustainable economic and social development the only way out is to strictly protect arable land and use intensive land efficiently. The measures we have adopted can be generalized into four aspects. That is, strictly controlling the "increment", vitalizing the "stock", improving the structure, and enhancing efficiency. Let me elaborate on each of them.

First, we will strictly control additional land use for nonagricultural purposes. Arable land is the lifeline of grain production and, thus, is the most valuable resource. We must adhere to the strictest possible system for the protection of farmland, implement strict regulations on land use and prevent the arable land and other agricultural land from being used for construction purposes. During the 14th Five-Year Plan period, the area of additional land designated for construction projects nationwide will be kept at 1.97 million hectares, with a reduction of 200,000 hectares over the 13th Five-Year Plan period.

Second, we will put existing resources to good use. We will reform the way of managing land use plans, ensure that land stays with the project it is allocated to, and implement the mechanism for coordinating the consumption of existing resources and the arrangements for additional resources to force local authorities to make great efforts to use land stock. Since the introduction of the mechanism in 2018, a total of 1.47 million hectares of land, consisting of land that had got approval but had not been provided to developers and land that had been left idle by developers, have been consumed over the past five years, over three times the area of additional land in the annual plan. It should be said that this mechanism has yielded good results.

Third, we will improve the land use structure. We will work to promote the redevelopment of land in urban areas that cannot be fully exploited in order to use the "stock" in exchange of the "increment". We will encourage the integrated development of above ground and underground spaces. We will double efforts to improve land use in rural areas in a comprehensive manner. We will ensure that the total acreage of arable land does not diminish, and the layout of permanent basic farmland remains stable. We will gradually move the arable land in higher mountains into lower areas and try to place fruit trees and forest trees along the mountains based on local conditions. These measures will release space by improving the land use structure. 

Fourth, enhancing efficiency. We will thoroughly advance the development of a sound unified rural-urban market for land designated for construction purposes, further improve the system for the paid use of state-owned land, make a big push to promote the combination of leasing and transferring of land designated for industrial purposes, and improve the secondary market for land. We will revise the standards on use of land for infrastructure purposes, expand the scope of paid use for such land, and strive to better utilize capital and technology for development. We will establish model counties (cities) for the conservation and efficient utilization of natural resources, guiding society in increasing awareness of economical and intensive use of land resources. During the 14th Five-Year Plan (2021-2025) period, we will strive to reduce the land for construction per unit of GDP. That is to say, the "land consumption" we often refer to will drop by about 15%.

The report delivered at the opening session of the 20th CPC National Congress noted that the nation will speed up the transition to a model of green development and implement a comprehensive conservation strategy. We will continue to improve the policy system for conserving various natural resources, including land, and using them efficiently, continuously promote conservation and efficient use of resources, and strive to obtain the greatest economic and social benefits with the least cost to resources and the environment.

Thank you.

China News Service:

There are some data on the typical aspects of China's cultivation of green manufacturing in Chapter 4 of the white paper. My question relates to China's green manufacturing system, which has been developing since the 13th Five-Year Plan (2016-2020) period. How is it progressing? What is its special significance to China's green development? How will you further promote green manufacturing? Thank you.

Xin Guobin:

Thank you for your question. With the support and coordination of relevant departments, we have continued to develop a green manufacturing system focused on energy saving, emission reduction and efficiency enhancement, driven by major projects and linked through the construction of green factories, green industrial chains, and green industrial parks since the 13th Five-Year Plan (2016-2020) period. China hosts a total of 2,783 green factories, 296 green supply chain management enterprises, and 223 green industrial parks, and has promoted nearly 20,000 green products. According to preliminary calculations, more than 95% of solid waste at the green industrial parks have been utilized. The energy consumption level of many green factories is better than the advanced value of the national energy consumption quota standard, and a whole-chain green product supply system from basic raw materials to terminal consumer goods has been gradually established.

As for its special significance for green development, we understand the following aspects: First, green manufacturing is an inherent requirement for promoting high-quality manufacturing development and building a modern industrial system. Second, green manufacturing is the fundamental way to break the bottleneck of resource and environmental constraints and realize sustainable development. Third, green manufacturing is a strong guarantee for promoting the economical and intensive use of resources and achieving safe development. Fourth, green manufacturing is an inevitable choice to conform to the trend of technological progress and promote the optimization and upgrading of the economic structure. Fifth, green manufacturing is also an important means of meeting people's growing demands for a beautiful ecological environment and promoting harmonious coexistence between man and nature.

Next, we will fully implement the decisions and arrangements of the Communist Party of China Central Committee and the State Council, and advance green manufacturing in the following five aspects: 

First, improve the green manufacturing and service system. We will draw up guidelines for accelerating the green, high-quality development of the manufacturing sector in accordance with new circumstances and tasks. We will make coordinated arrangements to promote green manufacturing and establish a mechanism for cultivating benchmarking enterprises in an incremental manner. 

Second, establish a policy system for green and low-carbon upgrading. We will continue to advance reduction of carbon emissions and pollution, green expansion, and economic growth in a coordinated manner and fully use fiscal, tax, financial, and other policy resources of the central and local governments to form a multi-tiered, diversified and packaged system of supporting policies. Such a system will support and guide enterprises in carrying out green and low-carbon upgrading and transformation.

Third, stress the guiding role of green and low-carbon standards. We will formulate guidelines for green and low-carbon standardization in industry and information technology to fully play the role of standardization technical organizations in various industries and speed up the formulation and revision of relevant standards.

Fourth, establish a guiding mechanism for digitally enabled green manufacturing. We will accelerate the coordinated transformation of digitalization and greening and promote the application of artificial intelligence, the Internet of Things, cloud computing, digital twins, and other next-generation information technologies in manufacturing.

Fifth, deepen international exchange and cooperation mechanisms for green manufacturing. Relying on existing multilateral and bilateral cooperation mechanisms, we will strengthen communication and exchanges on green and low-carbon technology innovation, outcome applications, policies and standards, and pragmatically advance cooperation and development. Thank you.

SSTV:

We have seen in Chapter 6 of the white paper that sound institutions and mechanisms are essential to green development. My question is, what work have we done to build and improve the system of institutions for ecological conservation and continuously improve the efficiency of green development in recent years? What has been achieved so far, and what are the plans for the next step? Thank you.

Zhao Yingmin:

Thank you for your question. Over the past 10 years, we have been focusing on building a sound system of institutions for ecological conservation with clearly defined property rights, diverse participants, as well as equal emphasis on incentives and constraints to provide a strong institutional mechanism and policy guarantee for green and low-carbon economic development. I will introduce for you three aspects: 

First, strengthening the rule of law. The past 10 years have seen the most vigorous legislative efforts, the strictest supervision and law enforcement, and the most effective implementation of the legal system on the ecological environment. Ecological advancement and conservation have been written into China's Constitution. There are more than 30 laws currently in force regarding ecological and environmental protection. They cover pollution prevention and control in fields such as air, water, soil, solid waste, and noise, as well as important ecosystems such as the Yangtze River, the Yellow River, wetlands, and black soil. The legal and regulatory system for ecological and environmental protection has basically developed. As of the end of last year, China had put in place 2,298 national ecological environment standards, effectively promoting the technological and economic progress of the industry and the optimization and upgrading of the industrial structure. We will continue to deepen the reform of the system whereby environmental protection agencies below the provincial level come directly under the supervision of their respective provincial-level agencies in terms of environmental monitoring, supervision, and law enforcement activities, and reforms for coordinated administrative law enforcement to protect ecosystems and the environment. We will improve law enforcement systems and methods, explore ways to put more than 44,000 enterprises on the positive list, strengthen the high-tech application of a comprehensive system that integrates air, space and land, and continuously improve scientific and targeted environmental law enforcement.

Second, in terms of regulatory systems, the central supervision system for ecological environment protection has served as a sharp weapon to ensure that all parties concerned fulfill their responsibilities in eco-environmental protection, which effectively addresses a series of prominent environmental problems. We have established and put in place various regulatory systems, covering the red lines for eco-environmental protection, region-specific approach to environmental management, the emissions permit, taking back the power for environmental quality monitoring, and sewage outfalls into seas and rivers. We have improved a series of accountability systems, such as the system for ensuring that Party committees and governments assume equal responsibilities for environmental protection, imposing lifelong accountability for environmental damage, mandating end-of-tenure auditing of natural resource assets for leading officials, and measures on evaluating performance in advancing ecological progress. We have piloted the compensation system for eco-environmental damage, and it is now implemented as a regular system.

Third, in terms of market mechanisms, we have put in place the carbon emissions trading system and launched the national carbon market, the world's largest in terms of the amount of greenhouse gas emissions covered, which has wrapped up its first compliance period. We have improved the green taxation system; expanded the catalog of corporate income tax credits for programs of carbon capture, utilization and storage, and comprehensive utilization of industrial waste. We supported the third-party enterprises engaged in pollution prevention and control and cut their corporate income tax rate to 15%. We also cut more than 13 billion yuan in environmental protection tax for taxpayers who emit below emission standards over the past nearly three years. We leverage the role of green finance, piloted the environment-oriented development model, and encouraged investment and financing in response to climate change. We have deepened the reform of the compensation system for eco-environmental conservation, and pushed forward the building of a mechanism where provinces situated on the upper and lower reaches of river basins compensate each other for their impact on water quality. We have made steady progress in building the legal disclosure system for environmental information and the credit system for ecological and environmental protection. The policy system for eco-environmental and economic development has been improved, playing an increasingly important role in guiding, incentivizing, and adjusting the market, which promoted the green, low-carbon transformation.

Next, we will earnestly implement the decisions at the 20th CPC National Congress, improve institutions and mechanisms for eco-environmental conservation, push forward the building of legal systems for eco-environmental protection, and enhance regulatory systems. We will step up efforts to improve fiscal, taxation, financial, investment, and price policies, as well as the system of environmental standards, to support green development. We will accelerate efforts in enhancing the governance system and governance capacity in the field of eco-environmental protection to better promote green, low-carbon development. Thank you.

Zhonghongwang.com:

The white paper mentioned that in the past decade, China has improved the efficiency of resource utilization, such as in the usage of energy, water, land, and raw materials. Could you please share relevant examples with us? Thank you.

Zhao Chenxin:

Thank you for your question. China is a major resource consumer. Conserving energy, resource, and improving resource utilization efficiency is of great significance to China and even global resource security. In the past decade of the new era, China has fully implemented Xi Jinping Thought on Ecological Civilization and adopted strong and effective measures to greatly improve the efficiency of resource utilization.

First, we have strengthened planning and guidance. China has incorporated indicators of resource conservation into its five-year plans, established and improved the evaluation assessment system, and promoted departments and local governments to fulfill their responsibilities. The State Council and relevant departments have issued a series of major comprehensive working plans on energy conservation and emission reduction, the building of a water-saving society, and the development of the circular economy. Such efforts have covered various aspects and forged synergy in pushing forward the resource conservation work. 

Second, we have strengthened energy conservation and improved efficiency in key areas. In major areas, such as industry, construction, transportation, and public institutions, we vigorously promoted energy saving through technological, management, and structural ways. In terms of industry, Mr. Xin just briefed us about green manufacturing. We have carried out the national water conservation campaign and promoted efficient irrigation in agriculture. We have strictly controlled the increase of land designated for construction projects. More efforts have been made to curb waste throughout the entire grain industrial chain. In 2021, the energy consumption per unit of the added value of industry above the designated size and water consumption per 10,000 yuan of value-added of the industry dropped by 36.2 % and 55%, respectively, from 2012.

Third, we have established and improved market-based mechanisms to promote resource conservation and increase efficiency. We have fully implemented the tiered pricing system for residential electricity, water, and gas, which encouraged the public to conserve resources as much as possible. We have introduced a differentiated electricity price policy for industries with high energy consumption. Efforts have been made to implement preferential tax treatments and explore trading systems for energy consumption rights, and water use rights, to promote the efficient allocation of resources. 

Fourth, we have strengthened legal frameworks. We have formulated and revised the Energy Conservation Law, the Anti-Food Waste Law, and Regulations on Energy Conservation by Public Institutions. We have strictly investigated and punished violations of laws and regulations. Measured against internationally high standards, we have developed and improved standards for the consumption of energy, water, and materials in key industries and products and ensured effective implementation.

Fifth, we have encouraged the participation of the whole society. Various activities have been carried out to promote resource conservation. We have worked to raise public awareness about cherishing resources and resource conservation. We have held week-long national campaigns to promote energy conservation for 32 consecutive years and week-long campaigns to promote water conservation for 31 consecutive years. Both achieved great progress. 

We will thoroughly implement the guiding principles of the 20th CPC National Congress, carry out a comprehensive resource conservation strategy, and accelerate the fundamental shift in the use of resources to pursue development on the basis of utilizing resources in a more rational, secure, and sustainable way, providing effective guarantee for building a modern socialist country in all respects.

Thank you.

China Education Television:

We noticed that there is a chapter in the white paper explaining the "green territorial configuration." Optimizing the development and protection of territorial space is an important part of it. What are the considerations in leveraging the role of territorial space planning to promote the building of a green territorial configuration? Thank you.

Liu Guohong:

Thank you for your question. A country's territorial space is the carrier for green development. General Secretary Xi Jinping stressed the need to plan economic and social development from the perspective of harmonious co-existence between man and nature. He said that we should, acting on the principles of prioritizing resource conservation and environmental protection and letting nature restore itself, develop spatial layouts, industrial structures, and ways of work and life that help conserve resources and protect the environment. The Ministry of Natural Resources has fully followed through on the important instructions made by General Secretary Xi Jinping. Efforts have been made to integrate different plans into a single master plan for territorial space development, design sound territorial space planning, which can be summarized into "five levels, three types", and put them into effect to promote the building of a green territorial configuration. Our works are mainly in three aspects, which are as follows:

The first is coordinating development and security, and supporting high-quality development while safeguarding the bottom line of resource security. For food security, priority has been given to drawing red lines for the protection of farmland and permanent basic cropland. The task of retaining at least 124.33 million hectares of farmland area will remain unchanged from 2021 to 2035. To guard the natural ecological security boundary, ecological conservation red lines have been established, and more than 30% of China's total land area is now under the protection of the red lines. To curb the expansion of urban sprawl, we have strictly controlled boundaries for urban development. We have acted in accordance with the principle that the urban development area should not be 1.1 times larger than the existing land construction area in megacities, cities with net population reduction, and cities where per capita construction land exceeds national standards, and not be 1.3 times larger in other cities.

The second is coordinating protection and development, and optimizing the development of territorial space. We have implemented a functional zoning strategy. Based on natural and geographical patterns and the carrying capacity of resources and the environment, we have optimized the strategic layout of major agricultural production zones, key ecosystem service zones, and urbanized zones, coordinated the spatial layout of water conservancy, transportation, energy and other infrastructure, and worked to build a new multi-center, networked, open, and intensive territorial space development configuration. We have encouraged urban and rural areas to use idle construction land effectively, promote endogenous and intensive urban development, and build beautiful and harmonious countryside that is desirable to live and work in.

The third is coordinating conservation and restoration, and taking a holistic and systematic approach to conserving and improving mountains, rivers, forests, farmlands, lakes, grasslands and deserts. We are taking coordinated steps to develop a national park-based nature reserve system, making overall deployments to protect and restore major ecosystems such as lands, rivers, lakes and oceans nationwide. We have launched large-scale and well-conceived greening programs, and carried out integrated protection, systematic restoration and comprehensive management of mountains, rivers, forests, farmlands, lakes, grasslands and deserts, so as to make the sky bluer, mountains lusher, waters clearer, the environment more beautiful, and the human-nature relationship more harmonious. As you may notice, not long ago, China's Shan-Shui Initiative was selected as one of the U.N.'s first 10 World Restoration Flagships, offering China's wisdom, solutions and strength for global biodiversity protection.

The report to the 20th CPC National Congress proposed developing a regional economic layout and territorial space system that complement each other's strengths and promote high-quality development; improving the functional zoning system and the development of territorial space; and advancing the Beautiful China Initiative and enhancing diversity, stability and sustainability in our ecosystems. We will fully implement the guiding principles of the 20th CPC National Congress, continue to deepen coordination in the three respects as mentioned earlier, constantly improve the territorial space planning system, and strictly implement the regulation system for the use of territorial space, so as to better advance high-quality development and achieve a high level of security. Thank you.

Phoenix TV:

The white paper calls on all countries to work together to tackle climate change and safeguard the Earth. What impact has China's green development had on the global response to climate change? What are your future considerations? Thank you.

Zhao Chenxin:

Thank you for your question, which is important. Mr. Zhao Yingmin, vice minister of ecology and environment, has participated in many negotiations on climate change and has just attended the U.N. Biodiversity Conference. His introduction was important and informative, and I would like to add a few more points.

China is the world's largest developing country, and its achievements in green development have strongly supported the global response to climate change. We are also willing to share our experience and achievements in China's green development with other countries. There is lots of relevant information in the white paper.

First, China's commitment to green and low-carbon development has enormously contributed to the global response to climate change. In the past decade of the new era, China has worked to adjust its industrial, energy and transportation structure to promote a green, low-carbon way of life and production, surpassing the target of cutting carbon intensity by 40% to 45% by 2020 compared to that in 2005. China has continued to improve its manufacturing capacity for renewable energy equipment. It now ranks first in the world for the production of wind power and photovoltaic power generation equipment, providing strong support for global energy transformation. China has also intensified efforts to protect and restore ecosystems, becoming the first country in the world to achieve "zero growth" in land degradation and a decrease in both desertification and sandification. Both China's forest coverage rate and forest stock have maintained growth, contributing more "Chinese green" to the world. Since the beginning of this century, roughly one-quarter of the global new green leaf area has come from China. Meanwhile, as I said in my previous answer and opening remarks, China has actively advanced the international negotiations on climate change, carried out South-South cooperation on climate change, promoted the Belt and Road Initiative as environmentally friendly, and made every effort to assist and help other developing countries, playing an essential role in enhancing the global capacity to address climate change.

Second, China has made a major strategic decision to achieve peak carbon emissions and carbon neutrality, injecting strong impetus into the global response to climate change. With the solemn commitment to peak its carbon dioxide emissions before 2030 and achieve carbon neutrality before 2060, China will achieve the biggest decrease in carbon intensity in the world, with shortest time in history between achieving peak carbon emissions and carbon neutrality, which will strongly promote the process of global carbon reduction. To advance peak carbon emissions and carbon neutrality, China has set up a leading group at the central governmental level, and each province, autonomous region and municipality directly under the central government has also set up its own leading group in this regard, forming a working system coordinated from top to bottom. We have also implemented a "1+N" policy system and deployed 10 "carbon peak campaigns" to form an overall pattern featuring clear goals, rational division of work, effective measures, and smooth coordination for promoting peak carbon emissions and carbon neutrality. Thanks to the joint efforts of all sectors of society, great progress has been made in key areas. For instance, as you may know, we have made smooth progress in constructing large wind power and photovoltaic bases with a capacity of 450 million kW in sandy areas, rocky areas and deserts. The first phase of projects with a capacity of approximately 100 million kW has started construction, the information of which we have released to the public in many ways. We are also advancing the second and third phases of the project. In 2021, the proportion of new environmentally-friendly buildings in urban areas increased to 84%. China's investment in clean energy has continued to grow in recent years. According to statistics from the International Energy Agency I saw earlier, China's investment in clean energy in 2021 reached $380 billion, ranking first in the world. Many domestic and international statistics show that China actively encourages the world to achieve carbon reduction targets with practical actions.

Next, China will stay committed to implementing the major strategic decision to achieve peak carbon emissions and carbon neutrality, accelerate its development model's green transformation, and continue contributing to the response to global climate change. First, we will take active yet prudent steps to achieve China's carbon peak and carbon neutrality goals, and strike a balance between development and emission reduction, the big picture and respective situations, long-term and short-term goals, and between the government and the market. Second, we will, based on China's energy resource endowment and its actual conditions, advance the energy revolution and accelerate the planning and construction of a new energy system in accordance with overall planning and the principle of establishing the new before abolishing the old. Third, we will improve China's industrial structure at a faster pace to promote green and low-carbon industrial development. Fourth, we will advance the efficient and intensive use of all resources, and continue to improve the efficiency of their use, as I have mentioned. Fifth, we will continue to improve the green and low-carbon policy system, and pool more resources and production factors to promote green development. Sixth, we will play an active role in global governance on climate change, carry out extensive international cooperation in the green and low-carbon fields, and work to build a clean and beautiful world. Thank you.

Xing Huina:

Today's press conference has now concluded. Thank you, speakers. Thank you to all my friends in the media. Goodbye.

Translated and edited by Zhang Liying, Wang Qian, Wang Yiming, He Shan, Zhang Lulu, Wang Yanfang, Xu Kailin, Ma Yujia, Wang Mengru, Zhang Junmian, Cui Can, Huang Shan, Xu Xiaoxuan, Duan Yaying, Liu Sitong, Li Huiru, Daniel Xu, Tom Arnsten, and Jay Birbeck. In case of any discrepancy between the English and Chinese texts, the Chinese version is deemed to prevail.

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Read in Chinese

Speakers:

Tian Yulong, chief engineer and spokesperson of the Ministry of Industry and Information Technology (MIIT) 

Zhao Zhiguo, spokesperson of the MIIT and director general of the Bureau of Information and Communications Administration of the MIIT

Tao Qing, an official of the Bureau of Operation Monitoring and Coordination of the MIIT

Chairperson:

Xing Huina, deputy director general of the Press Bureau of the State Council Information Office (SCIO) and spokesperson of the SCIO

Date:

Jan. 18, 2023

Xing Huina:

Friends from the media, good afternoon. Welcome to this press conference held by the State Council Information Office (SCIO). Today, we have invited Mr. Tian Yulong, chief engineer and spokesperson of the Ministry of Industry and Information Technology (MIIT). Mr. Tian will brief you on the development of the industry and information technology sector in 2022 and take your questions. We are also joined by Mr. Zhao Zhiguo, spokesperson of the MIIT and director general of the Bureau of Information and Communications Administration of the MIIT, and Ms. Tao Qing, an official of the Bureau of Operation Monitoring and Coordination of the MIIT.

Now, I'll give the floor to Mr. Tian Yulong for a brief introduction.

Tian Yulong:

Ladies and gentlemen, friends from the media, good afternoon. As the new year begins and the Spring Festival approaches, I would like to take this opportunity to extend my best Chinese New Year wishes to you in advance and wish you happiness and good luck in the upcoming Year of Rabbit. I'd also like to thank you for your continued interest in and support for the development of the industry and information technology sector. Now, I'll brief you on the sector's general situation in 2022.

The year 2022 was of crucial significance in history to both the Communist Party of China (CPC) and the nation. Under the strong leadership of the CPC Central Committee with Comrade Xi Jinping at its core, the MIIT, together with all localities and government departments, has thoroughly implemented the decisions and plans of the CPC Central Committee and the State Council. It has acted in full accordance with the key requirements of ensuring effective COVID-19 containment, economic stability, and development security. It has also proactively responded to the shocks of unexpected factors. As a result, China's industry and information technology sector achieved generally stable growth while making further progress. Specifically, the industrial economy has resumed steady growth with a promising outlook; the information and communications technology (ICT) industry has posted a stable growth; and the industrial and supply chains has achieved unimpeded and stable operations. In addition, the industrial sector's contributions to the national economy have further increased; the nation's industrial development has shown greater resilience; and the specialized development of small- and medium-sized enterprises (SMEs) has been further accelerated. In general, the sector has the following four highlights.

First, the industrial economy has resumed its steady growth with a promising outlook, and its role as an anchor of the macro economy has become even more evident. Ensuring stable growth was high on the agenda last year. Given this, we took multiple measures to expand investment, boost spending, and stabilize foreign trade, and our efforts to ensure the unimpeded and stable operations of industrial and supply chains have paid off. In 2022, China's added value of industries above the designated size grew by 3.6% year on year, and that of the manufacturing industry increased 3% year on year. Investment in the manufacturing sector climbed 9.1% from a year earlier, and the export delivery value of industrial enterprises above the designated size rose 5.5% year on year. The industrial economy provided a strong support for stabilizing the macro economy. The industrial sector contributed to 36% of the nation's economic growth, a relatively high level compared to recent years. The industrial sector lifted the nation's economic growth by 1.1 percentage points, which included a boost of 0.8 percentage points from the manufacturing industry. The added value of the manufacturing industry accounted for 27.7% of the nation's gross domestic product (GDP), up 0.2 percentage points over the previous year.

Second, industrial restructuring, transformation, and upgrading have been thoroughly advanced, and industrial development has shown greater resilience. We have continued regarding high-quality development as our top priority and strived to promote industrial restructuring, transformation, and upgrading. As a result, the manufacturing sector has become higher-end, smarter, and more eco-friendly at an accelerated pace. A number of sci-tech innovation achievements have been made. For example, China's first self-developed C919 large passenger aircraft was delivered at the end of last year. Breakthroughs were also made in the whole machine and key spare parts of China's self-developed extracorporeal membrane oxygenation (ECMO), which has been certified for marketing and put into use. A total 45 national-level advanced manufacturing clusters and another 100 SME clusters for distinctive local business were developed. The industrial internet has been used in 45 major categories of the national economy, and there has been more than 240 influential industrial internet platforms, injecting new impetus to industrial upgrading. Steady progress has been made in the eco-friendly and low-carbon transformation of industries. In the first 11 months of 2022, the energy consumption per unit of added value of industries above the designated size dropped 1.4% year on year. The added value of high-tech manufacturing industry grew by 7.4% year on year in 2022, 4.4 percentage points higher than the growth rate of the added value of the manufacturing sector as a whole. The production of new products maintained a high growth rate. In particular, the production of new energy vehicles has been ranking first globally for eight consecutive years, and their production and sales grew by 96.9% and 93.4% year on year, respectively. This speaks volumes for the resilience and stability of industrial development.

Third, the ICT industry posted a stable and continuous growth, and industrial integration further enabled the sector's development. We continued leveraging the leading role of new-generation information technologies, and ramped up efforts to develop new business forms and tech applications. In 2022, the revenue of China's telecommunication sector grew by 8%. Investment in the sector continued to expand, and infrastructure kept improving. China built 887,000 new 5G base stations in 2022, and the total number amounted to 2.312 million, accounting for over 60% of the global total. Among Chinese cities, 110 have reached the standard of building 1000M fiber optic networks. The number of mobile Internet of things (IoT) connections in China reached 1.84 billion, making China the first among major economies to have more IoT connections than internet users. The number of 5G users reached 561 million, accounting for one-third of all mobile phone users, 2.75 times that of the global average. Integration of tech applications were further accelerated. More than 50,000 5G applications have enabled multiple sectors such as industries and healthcare services. The management of mobile applications saw further progress in 2022, and users' rights and interests were effectively safeguarded. More efforts were made to strengthen the protection of critical information infrastructure and improve data security management in industry and information technology sector at an accelerated pace. The capacity to ensure emergency communications continued to strengthen, and the nation's basic telecommunication networks maintained their safe and stable operations. The ICT industry has effectively supported and guaranteed economic and social development and the construction of the digital economy.

Fourth, policy planning continued to take effect, which further boosted business confidence. We earnestly implemented the decisions and plans of the CPC Central Committee and the State Council, kept policy planning as our main focus in order to stabilize growth, and continued to unleash policy dividend and boost business confidence. We scaled up the efforts to carry out the policy package on stabilizing economy and its follow-up measures. We also worked with relevant government bodies to introduce a series of policy documents on further boosting the industrial economy and providing assistance to SMEs. We organized and rolled out 27 plans in the industry and information technology sector for the 14th Five-Year Plan period (2021-2025), in a bid to ensure the coordination and implementation of key industries, projects, and programs. The driving force of these policies and plans has translated into a strong momentum to restore the industrial economy and boosted business confidence and expectations. In 2022, China's tax and fee cuts, tax refunds, and tax and fee deferrals for all types of market entities topped 4 trillion yuan, about 40% of which were offered for micro and small businesses. This has created a solid guarantee to ease the difficulties of SMEs and enable their sound and stable development.

In 2023, the development of the industry and information technology sector still faces a severe and complicated domestic and overseas environment. In particular, the sector's stable operations in the first quarter requires arduous efforts. We believe that, with the optimization of COVID-19 response and the effect of both existing and new policies, we have the confidence, resolve, and ability to cope with various difficulties and challenges. Looking forward, we will fully carry out the guiding principles of 20th CPC National Congress and the decisions and plans of the Central Economic Work Conference. We will keep ensuring stable growth high on the agenda and strive to expand demand, foster market circulation, assist businesses, strengthen growth momentum, and stabilize expectations. We will see to it that the industry and information technology sector achieve new progress, expedite the development of new industrialization, and make new and greater contributions to building a modern socialist country in all respects.

That concludes my introduction. Next, my colleagues and I will take your questions. Thank you.

Xing Huina:

The floor is now open for questions. Please indicate the media organization you work for before raising questions.

Yi Cai:

In recent years, the new energy vehicle industry has maintained rapid development. Can you talk about the development of this industry in 2022? What measures will be adopted by the MIIT to promote its high-quality development? Thank you!

Tian Yulong:

Thank you. I will answer your questions. The new energy vehicle industry is a major direction for the transformation and upgrading of the global automobile industry. This industry has been developing rapidly in all countries. And it is also an important option for emission reduction. Last year was another bumper year for the development of the new energy vehicle industry, mainly reflected in the following aspects.

First, China has been leading the world in market size. In 2022, a total of 7.058 million new energy vehicles were produced, and 6.887 million were sold, with a year-on-year increase of 96.9% and 93.4%, respectively, ranking top globally for eight consecutive years. The sales of new energy vehicles accounted for 25.6% of the total sales of new vehicles. The data is promising, and the industry shows a strong momentum for development.

Second, new breakthroughs have been made in key technologies. The energy density of mass-produced power batteries stood at 300 watt-hours per kilo, reaching an advanced level globally. The gravimetric specific power of the driving motor surpassed 4.8 kWh per kilo, with the highest rotational speed reaching 16,000 rpm. These indicators show that great improvement has been achieved in key components and parts. In particular, breakthroughs have been made in technologies concerning laser radar, AI chips, and intelligent cabins, reaching an advanced global level.

Third, brand competitiveness has markedly improved. In 2022, sales of Chinese-brand new energy passenger vehicles took up 79.9% of the total sales in the domestic market, up 5.4% year on year. The new energy vehicle exports reached 679,000, a 1.2-fold increase over the previous year. Among the global top 10 enterprises in terms of sales of new energy vehicles, three are Chinese enterprises. Among the global top 10 enterprises in terms of installed capacity of power batteries, six are Chinese. The competitiveness and brand impact have been increasingly stronger. 

Fourth, supporting facilities have been increasingly optimized. As of the end of 2022, a total of 5.21 million charging plies and 1,973 battery charging stations have been established. 2.593 million charging piles and 675 battery charging stations were added in 2022. The construction of battery charging and swapping facilities has been notably accelerated. At the same time, over 10,000 service outlets for recycling power batteries have been built, basically ensuring that people can access battery recycling services close to home.

Currently, China's new energy vehicle industry has entered a period of market expansion across the board and maintained rapid growth. Next, we will strengthen our work in the following aspects.

First, stronger policy support will be provided. We will work with relevant departments to establish a coordination mechanism for developing this industry and strengthen coordination and synergy between central and local governments. In particular, we will promote the implementation of supporting policies concerning vehicle purchase tax, vehicle and vessel tax, license plates, and others. We will formulate a roadmap for green development of the automobile industry, revise and issue "double credits" management provisions for corporate average fuel consumption and new-energy vehicles, and launch trials for the market access of intelligent connected vehicles.

Second, steady performance will be ensured. We will conduct research on formulating follow-up supporting policies for the new energy vehicle industry. We will promote the application of battery-charging facilities and the development of fuel-cell vehicles. In particular, we will launch pilot programs in establishing pioneering zones for comprehensive electrification of vehicles in public areas in cities. Further steps will be taken to promote quality brands, and to maintain consumer market stability.

Third, integrated innovation will be supported. We will give full play to the role of leading enterprises and national manufacturing innovation centers and promote small, medium, and large enterprises to pursue development through greater synergy. We will accelerate research and industrial development of new technologies, including new types of batteries, automotive-grade chips, and automotive operating systems, advance integrated development of autonomous driving vehicles and the cooperative vehicle infrastructure system, and enhance the integrated and innovation-driven development of the new energy vehicle industry and sectors such as energy, transportation, and ICT.

Fourth, the development environment will be optimized. We will carry out strict management of production access and provide stronger guidance for investment to avoid low-level and redundant construction. Development and distribution of domestic and overseas resources will be carried out in a coordinated way to ensure the supply of raw materials and key parts. Regulations on recycling power batteries will be formulated at a faster pace to improve the system for recycling power batteries. Greater efforts will be taken to advance the construction of charging piles, and their accessibility will be improved to provide sound facilities and environment for the development of new energy vehicles.

Thank you!

China Electronics News:

The industrial internet plays a crucial role in promoting deep integration of the digital economy and the real economy, and it has been producing positive effects on advancing the transformation and upgrading of traditional industries. What new progress was made regarding China's industrial internet in 2022? What will be done to advance wider application of the industrial internet? Thank you.

Zhao Zhiguo:

Thank you for your questions. In 2022, we resolutely implemented the decisions and plans of the CPC Central Committee and the State Council, sped up the development of the industrial internet, with the total output value of this industry estimated to be 1.2 trillion yuan, providing strong support for high-quality economic and social development.

First, an analysis system for industrial internet identification has been fully established. Five national top-level nodes covering the eastern, western, southern, northern, and central regions and two nodes for disaster tolerance and backup have been put into use. Second-level nodes have fully covered 31 provinces (autonomous regions, municipalities) and provided services for nearly 240,000 enterprises. Over 240 influential industrial internet platforms have been developed, with 28 cross-industry and cross-sector platforms, effectively promoting data sharing and resource coordination among the whole process of product development, all links of production, and upstream and downstream supply chains, and accelerating digital transformation of enterprises.

Second, the "5G+Industrial Internet" 512 Project has been accomplished successfully. Five public service platforms for the industry have been built, providing services for industrial enterprises in their application of 5G technologies. Over 4,000 projects have been launched in more than 10 key industries, including automobile and mining industries. The application of 20 typical application scenarios such as coordinated research, development and design, and the remote control of equipment have been promoted at a faster pace, effectively promoting enterprises to improve quality, reduce costs, and increase efficiency. The integration of the industrial internet and 5G has produced an increasing variety of products. The price of modules has dropped by 80% from the early stages for commercial use. Waves of constructing 5G connected factories have swept across the country, advancing the application of 5G technologies to the core links of production.

Third, multiple measures have been adopted to empower the transformation of the industry. Based on the common needs of the industry, we have developed a batch of carriers to serve the promotion of the application of the industrial internet and foster low-cost and lightweight solutions, lowering the thresholds for enterprises, especially SMEs, to carry out digital transformation. Focusing on the characteristics of various industries, we have formulated and promoted the guidance for integration and application of the industrial internet for over 10 key industries, such as the steel industry and the electronic industry, guiding the industries and enterprises to apply the industrial internet in accordance with the conditions specific to their industries and enterprises. Addressing weak links, we have implemented innovative projects for the industrial internet development, advanced research and industrialization of key technologies and products, and issued a series of national standards, industrial, and group standards, furthering improving the system of standards.

Next, our work will focus on three aspects to accelerate the large-scale development of the industrial internet, promote deep integration of the digital economy and real economy, keep unleashing momentum for industrial upgrading, and support the industrial economy to steadily rebound. 

First, we will optimize the environment by enhancing policy guidance. We will, together with other government departments and local authorities, take solid steps to advance the implementation of a three-year action plan (2021-2023) for the innovative development of the industrial internet to ensure that all work will be accomplished. We will formulate policies and measures to promote the large-scale development of the industrial internet, further improve the top-level design, make good and full use of fiscal, tax, and financial policies, and strengthen cooperation between industry and finance and integration between industry and academia to further create a sound development environment. 

Second, we will create more drivers for development by promoting innovation. We will enhance technological innovation and continue to implement innovative projects for industrial internet development, strive to make major breakthroughs in technologies, and improve the system of standards to remove the major obstacles hindering the large-scale development of the industrial internet. We will deepen industrial innovation, support all kinds of market entities such as telecommunication enterprises, internet platform companies, and industrial enterprises to leverage their strengths and create greater synergy. We will make great efforts to nurture leading enterprises and specialized and sophisticated SMEs that produce new and unique products, and strengthen the industry alliance for the industrial internet to create a healthy and sustainable environment for the industry. 

Third, we will push for wider application by accelerating the promotion and popularization of the industrial internet. We will move faster to foster advanced factories, and encourage enterprises to carry out the digital transformation of factories by means of 5G and other technologies to promote wider applications of new technologies, new scenarios, and new models. We will accelerate upgrading clusters of industries, launch the campaign to promote the application of the industrial internet in 1,000 industrial parks of 100 cities and summarize and promote successful cases to advance digitalization and green development of industrial parks. We will expand the application of the industrial internet in key sectors and in key industrial chains, and widely promote supply-demand matching to promote high-quality development of the real economy by large-scale application of the industrial internet.

Thank you!

CCTV:

The report to the 20th CPC National Congress has underlined that the resilience and security of China's industrial and supply chains will be improved. What has been done by the MIIT to enhance the resilience, security, and competitiveness of industrial and supply chains? What measures will be adopted next? Thank you.

Tian Yulong:

Thank you. We will have Mr. Tao Qing answer your questions. 

Tao Qing:

Thank you for your questions. Since the beginning of 2022, the MIIT has resolutely implemented the decisions and plans of the CPC Central Committee and the State Council, taken it as a top priority of its work to maintain security and stability in industrial and supply chains and worked with relevant departments to effectively respond to the impact of unexpected factors. With all these efforts, the overall security and stability of the manufacturing industry in China have been maintained, and the resilience of China's industrial and supply chains has been further enhanced. First, we have given equal emphasis to short-term response and long-term prevention and made every effort to ensure smooth circulation of industrial and supply chains to consolidate the foundation for ensuring stability. Especially when responding to the impact of the pandemic in April last year, we rapidly established a white list system for enterprises in key industrial and supply chains and promoted work and production resumption along industrial chains in a coordinated and systematic way. We have built up coordination platforms for key industrial and supply chains such as integrated circuits, automobiles, and medical supplies, established a "red light" early warning mechanism for auto parts inventory, and a "red, yellow, and blue" early warning coordination mechanism for bulk raw material supply, and helped to resolve problems that concerned enterprises one by one to ensure stability in key industrial chains. Meanwhile, we have comprehensively summarized the experience, guided local authorities to strengthen early warning and monitoring of emergencies, and set up contingency plans in advance to resist risks to reinforce the ability to withstand risks. Second, we have worked to shore up weak links and build up strengths at the same time and adopted a package of steps to strengthen the core competitiveness of the industrial and supply chains. We have held International Forum on Resilient and Stable Industrial and Supply Chains. General Secretary Xi Jinping has sent a congratulatory letter to the forum. During the forum, we, together with Indonesia, and five other countries, have jointly released the Initiative of International Cooperation on Resilient and Stable Industrial and Supply Chains. Focusing on the blockages in industrial and supply chains, we have launched projects to achieve breakthroughs in core technologies in key fields and projects for upgrading foundational industrial infrastructure to promote breakthroughs in important basic products and core technologies in key fields. We have given play to the guiding role of plans in promoting traditional competitive industries and emerging industries to break growth bottlenecks. We have fostered clusters of advanced manufacturing, with global competitive edges in some areas taking shape. We have promoted the development of specialized and sophisticated SMEs that could produce novel and unique products and given play to the leading role of competitive enterprises to boost the dynamism of the manufacturing industry.

Next, we will keep putting equal emphasis on development and security, give priority to major tasks of shoring up weak links, building up strengths, consolidating foundations, and fostering clusters of industries, and accelerate the upgrading of the industrial base and modernization of industrial chains. Our work will mainly focus on the following three aspects.

First, we will cement foundations and move faster to shore up weak links. We will implement projects for upgrading foundational industrial infrastructure and projects to achieve breakthroughs in core technologies in key fields to build a more self-supporting, safer, and more reliable industrial system with their risks better controlled. We will encourage leading enterprises in industrial chains to strengthen cooperation with upstream and downstream SMEs on technology research, production verification, and standards setting to enhance collaborative innovation and integrated development of industrial chains.

Second, we will consolidate the advantages and create new growth drivers. We will take active steps to reinforce advantages in key advantageous areas, enhance the competitiveness of traditional industries, and accelerate the deep integration of the new generation information technology and the manufacturing industry. We will work hard to develop the digital economy, seize new strategic opportunities, accelerate the development of new technologies, new forms and new models, and promote the development of advanced manufacturing clusters.

Third, we will guard against risks and ensure stable and smooth industrial and supply chains. We will improve the ability to identify and cope with risks, strengthen the monitoring of key areas and key industries, and strengthen synergies between departments and regions to enhance the ability to cope effectively with risks in a coordinated way. We will expedite the implementation of policies on benefiting enterprises and keeping business operations stable, and guarantee the supply of industrial production factors to ensure normal production and operations of enterprises to the maximum possible extent.

Thank you!

ThePaper.cn:

Recently, the demand for medicine and medical devices such as antipyretic and analgesic drugs and oxygen concentrators has increased. What is the current production and supply situation of medicine and medical devices? What's the MIIT's judgment about the next stage of their production and supply? Thank you. 

Tian Yulong:

Thank you for your questions. Recently, the MIIT has implemented the decisions and deployments of the CPC Central Committee and the State Council in conjunction with relevant departments. Under the direct command of the joint COVID-19 prevention and control mechanism, the MIIT, leading this mechanism's medical supply support group, has further guaranteed access to medical supplies together with group member departments and relevant localities. We have also made every effort to help pharmaceutical and medical enterprises fulfill their production goals as well as stabilize and expand production and capacity. We have increased the supply of key drugs in the market and guided their reasonable, orderly, and precise distribution. The current characteristics are as follows:

First, we have made every effort to ensure the production and supply of key medical materials. In terms of drugs, as of Jan. 17, on the basis of maintaining a production capacity of 200 million tablets for 17 consecutive days, 5.14 billion tablets of two key antipyretic and analgesic drugs - ibuprofen and acetaminophen - have been supplied, which can fully meet the medicine demand. In terms of medical equipment and devices, as signs of higher demand for medical resources for severe case treatment emerge, the MIIT recently focused its work on "preventing severe cases and ensuring equipment supply" in a timely manner. As of Jan. 17, the daily output of Azvudine, a small-molecule antiviral drug, has increased by 148% to 744,000 bottles compared with before New Year's Day. Daily output and production capacity have been greatly improved, which can meet the medicinal needs of medical institutions for patients with severe conditions as well as subsequent severe cases. Currently, thanks to a rising scale in production, the daily output of invasive ventilators has increased by 239% to 1,808 units compared with that before New Year's Day. The daily output of oxygen concentrators has increased by 280% in four days, and the maximum daily output can exceed 20,000 units. The supply of oxygen concentrators has been able to meet the basic needs of medical institutions. The daily output of much-needed finger pulse oximeters has exceeded 460,000 units, which can not only meet the needs of medical institutions but can also gradually and sufficiently supply society's needs.

Second, we have conducted precise distribution to prioritize needs in key areas. We share people's concerns. In accordance with the principle of "focusing on key areas and providing targeted distribution," we have worked with relevant departments to actively align with the departments in charge of civil affairs, rural affairs, education, among others and provided targeted medical supplies for key areas (populations), such as in elderly care, rural areas, and schools. Since mid-December last year, we have delivered nearly 136 million doses of drugs through large e-commerce platforms and local drug support platforms, benefiting more than 60 million people in total. Thanks to the convenience and accessibility of e-commerce, we have created a precise distribution model. At the same time, we have equipped every rural clinic with two finger pulse oximeters and supplied 1.172 million finger pulse oximeters in four batches so as to bring finger pulse oximeters to rural areas. Meanwhile, through various financial drives, including corporate donations, more than 10,000 medical oxygen concentrators have been provided free of charge for more than 800 counties lifted out of poverty across the country, fully covering 10,000-plus towns and townships in these counties. We have fully met the needs of key medical supplies for old-age care and child welfare institutions nationwide, as proposed by the civil affairs departments. Currently, we are working with education departments to ensure that the needs of universities for key medical supplies nationwide are satisfied.

Third, we have smoothed the supply channels of medical supplies through various cooperations. We have worked with the transport and postal departments to prioritize delivering urgently-needed medical materials at the community level, especially in rural and remote areas, and spared no effort to link up the "last kilometer" of delivery. We have also formulated a plan to guarantee smooth logistics of enterprises during the Spring Festival and strived to ensure transport and reserve capacities during the Spring Festival and other holidays.

Next, the MIIT will continue to further support the stable production of key medical material enterprises, strengthen supplies, targeted coordinated distribution, and never reduce its efforts in ensuring supplies.

Thank you!

CGTN:

As we all know, China has been adhering to the path of green development. Especially since the carbon peak and carbon neutrality goals were put forward, a green and low-carbon transformation has been further accelerated across society. What are the future considerations of the MIIT regarding energy saving, carbon reduction, and green transformation in the industrial sector? Thank you.

Tian Yulong:

Thank you, and I'll give the floor to Ms. Tao Qing for this question.

Tao Qing:

Thank you for your question. Industry is the backbone of the national economy and its engine of growth. It is also an important battlefield for promoting green development transformation. The MIIT has thoroughly implemented the guiding principles of the 20th CPC National Congress and earnestly promoted a green and low-carbon transformation of the manufacturing industry.

First, the action plan for peaking industrial carbon emissions has been carried out in an orderly manner. Together with the National Development and Reform Commission and the Ministry of Ecology and Environment, we have issued an implementation plan for carbon peak in the industrial sector and coordinated in mapping out a timetable and a roadmap for peaking industrial carbon emissions.

Second, solid progress has been made in industrial green transformation and development. We have thoroughly implemented the plan for the green development of China's industrial sectors during the 14th Five-Year Plan period (2021-2025), introduced and implemented a package of schemes and action plans for improving energy and water efficiency, as well as comprehensive utilization of resources, and formulated the measures for supervision and inspection on industrial energy conservation. We have organized energy conservation monitoring on 3,572 key enterprises, and provided diagnostic services for 124 key enterprises and 1,187 specialized and sophisticated SMEs that produce new and unique products.

Third, green and low-carbon models have been cultivated and expanded. A number of national green factories, green industrial parks, and green supply chain enterprises have been selected. In addition, 99 green design demonstration enterprises, 282 enterprises meeting the industrial standards and conditions, and 32 pilot enterprises (parks) recycling industrial wastewater have been cultivated.

Fourth, the popularization and application of green and low-carbon technologies have been accelerated. Efforts have been intensified to popularize and apply advanced techniques, technologies, and equipment for energy and water-saving plans, cleaning and environmental protection, and comprehensive utilization of resources. Various supply-demand matching and technical training exchanges have been held online and offline.

Next, the MIIT will earnestly implement the guiding principles of the 20th CPC National Congress and the Central Economic Work Conference, take the carbon peak and carbon neutrality goals as the leading principles, take promoting green and high-quality development of the manufacturing industry as its own responsibility, and advance carbon and pollution reduction, green expansion, and growth in a coordinated manner so that green development can become the defining feature of the new type of industrialization.

First, we will accelerate the green and low-carbon transformation of the manufacturing industry. We will formulate and introduce the Guidelines for Accelerating the Green and High-Quality Development of the Manufacturing Industry, clarify the implementation measures, give differentiated guidance, and implement industry-specific policies, as well as promote the green and low-carbon development transformation of key industries, parks, enterprises, and localities in an integrated manner.

Second, we will conduct special actions for industrial energy conservation and carbon reduction. We will fully implement the carbon peak plans in the industry and key sectors. We will continue to monitor national energy conservation, and carry out in-depth activities providing industrial energy conservation diagnostic services and energy conservation services to enterprises. We will launch a number of pilot projects, including developing industrial green microgrids and digital carbon management systems.

Third, we will advance green manufacturing. On the basis of building green factories, we will accelerate the construction of the green manufacturing system and improve the evaluation index system in accordance with the new goals of achieving carbon peak and carbon neutrality.

Fourth, we will promote improving quality and efficiency in the comprehensive utilization of resources. We will carry out projects to optimize battery recycling and utilization and improve the recycling and utilization system. We will strengthen the standardized management of comprehensive utilization industries of renewable resources such as scrap steel and waste paper, promote the pilot implementation of extended producer responsibility for automobile products, and improve our ability to utilize complex and hard-to-use solid waste and emerging solid waste. We will update and publish the catalog of advanced and applicable technologies for the comprehensive utilization of industrial resources.

Fifth, we will strive to improve the level of clean industrial production. We will coordinate and promote green and high-quality development in the Beijing-Tianjin-Hebei region, along the Yangtze Economic Belt, and other areas. In particular, we will focus on steel, petrochemical, chemical, and other key water-using industries to carry out pilot recycling projects for industrial wastewater. 

Sixth, we will foster new drivers of green growth. We will vigorously develop green and environmental protection industries and cultivate key enterprises with advantages. We will improve the mechanism for promoting green transformation and guide fiscal and financial resources to increase support for the green development of the manufacturing industry.

Thank you!

Economic Daily:

As we know, the monthly data of value added of industrial enterprises above the designated size fluctuated markedly last year. How to evaluate the industrial performance for the whole year? Will the trend of recovery continue this year? Thanks.

Tian Yulong:

Thanks for your questions. As I said in my opening remarks, the industrial economy in 2022 faced a relatively severe and complex environment both at home and abroad, and was under great pressure to ensure steady growth.

Over the past year, under the support from all regions and departments, the MIIT put steady growth as its top priority, adopted a series of measures to achieve recovery of the industrial economy in a short time, and maintained sound momentum, demonstrating the "ballast" role of the industrial economy in the macroeconomic performance, as well as contributing China's share in stabilizing the global industrial and supply chains and in promoting the recovery of world economy. 

Overall, the value added of industrial enterprises above the designated size grew 3.6% year on year in 2022. The first quarter got off to a good start with a sound momentum, while it fell sharply in April and began to stabilize and rally again in May. This fluctuation was relatively large. In the fourth quarter, the downward pressure increased because of the pandemic. But on the whole, the positive trend of stability has remained unchanged. In terms of industries, key industries generally performed stably. In particular, the equipment manufacturing industry registered fast growth. In 2022, the value added of this sector grew 5.6%, contributing 50.3% to the overall industrial growth. Among them, a representative sector, including electric machinery as well as instruments and meters, increased by 11.9% and 4.6%, respectively. The automobile industrial and supply chains were fully restored, with annual production and sales rising by 3.4% and 2.1%, respectively, in 2022. Generally, the driving power of the equipment manufacturing sector was very strong. Raw material for manufacturing was growing despite of the pressure. In 2022, the value added of the sector rose 1.6% year on year, with the first three quarters running at a low level, and the growth accelerated since September. The consumer goods manufacturing gradually recovered. In 2022, the value added of the sector grew 0.6% year on year. Daily necessities industry such as food, agricultural and non-staple food, wine, beverage, and refined tea maintained certain growth.

In terms of key products, products of new energy and new drivers of growth grew rapidly, and daily necessities rose steadily. The production and sales of new energy vehicles reached 7.058 million and 6.887 million, up 96.9% and 93.4% year on year, respectively, while the output of charging piles and solar panels soared by 80.3% and 47.8% year on year, respectively. New material products grew at a high level - the production of polysilicon and monocrystalline silicon, for example, grew rapidly, reaching 64.4% and 51.8%. High-tech products also posted rapid growth, with the output of mobile communication base station equipment as well as the industrial control computers and systems increasing by 16.3% and15.0% respectively. We have guided enterprises to focus on the needs of the people and increased the production and processing of related products to effectively meet consumer needs. The output of flash frozen food and dairy products rose 3.3% and 2.0%, respectively, and the woolen fabrics up 4.7%.

In terms of regions, most provinces saw their industrial economy recovering steadily. Last year, 24 of the 31 provinces, autonomous regions and municipalities directly under the central government logged growth to value added to industry. Among them, major industrial provinces such as Jiangsu, Shandong, Zhejiang, Henan, Fujian, Sichuan, Hubei, Hunan, and Hebei posted higher growth rates than the national level. The growth rate of major economic indicators in the central and western regions took the leading position. Last year, the value added of industry of these regions increased by 6.8% and 6.2%, respectively; while the eastern region raised 3.0% year on year, showing steady signs of recovery. 

In 2023, the external environment remains complex, and the development of the industrial sector is still under great pressure. However, in general, the growth trend and pattern remain unchanged, and the economic fundamentals that will sustain long-term growth have been stabilized and consolidated. We believe that with the effective release of the vitality of market entities, the potential of consumer consumption, and the impetus for industrial upgrading, the steady recovery of the industrial economy will keep unchanged so as to provide stronger support for the macroeconomy.

That's all for me. Thanks!

Southern Metropolis Daily:

We noticed that the MIIT recently solicited public opinion on further improving the service capacity of mobile internet applications, aiming to optimize the services and enhance user experience. What achievements has the MIIT made in promoting ICT serving people's livelihoods in the past year? What's the next plan? Thanks.

Zhao Zhiguo:

Thank you for your question. The MIIT attaches great importance to the protection of users' rights and interests and personal information, and continues to improve the ICT capacity and services so as to effectively protect the legitimate rights and interests of users.

First, the quality of services has been improved, and user perception has been refined constantly. We launched campaigns to improve service perception and guided information and communications enterprises to provide quality services. We optimized the business handling process, realized online and remote telecommunication services such as plans change, contract cancellation, and other common services; promoted 100 key internet enterprises to establish customer service hotlines with real person responding to users' demands timely; prompted app stores to improve their review mechanism before launching an app. By the end of last year, the number of various high-quality apps in use exceeded 2.58 million in China, and intelligent applications have enriched people's production and life.

Second, we have improved the accessibility of convenient digital services. More solid outcomes have been delivered and shared by all. We have continued to expand the coverage of the internet, further promoted universal telecom services, supported rural and remote areas to speed up the coverage of the internet, and worked hard to realize broadband connection in all administrative villages nationwide for the first time in history. We have also adopted targeted fee cut measures like preferential policies for special groups such as micro-, small- and medium-sized enterprises (MSMEs), poor households, the elderly, and the disabled. As a result, the average rates for broadband and dedicated internet access services for MSMEs have dropped by 24.2% and 21.9%, respectively, as compared with those in December 2021. More than 32 million households of seniors and disabled people have benefited from the measures, doubling the number in 2021. By doing so, users are increasingly feeling the benefit. We have steadily improved telecom services for the convenience of senior citizens by facilitating usage and improving service quality. Enterprises have been encouraged to provide elderly users with telecom services that can be handled remotely and to resolve technical difficulties for them. A total of 648 websites and apps have finished such improvements.

Third, we have improved oversight effectiveness. Protection of users' rights and interests has been strengthened. We have enhanced management at the source, urged and guided app stores and other distribution platforms to fully harness the role of "goalkeepers," so that apps are reviewed and hit the shelves in accordance with laws and regulations. In 2022, we conducted tests on 1.51 million apps in six batches, achieving a much higher percentage of passing than in 2021. We have built a strong technology shield and established an anti-fraud platform in the ICT industry. Since 2022, we have intercepted a total of 1.82 billion scam phone calls. Cyber security and protection have been increasingly strengthened. We have improved the governance model, curbed spamming on an ongoing basis, intensified administrative guidance, and made regulatory bodies get involved at earlier stages. By doing so, complaints from users dropped to the lowest level in history.

ICT services concern the interests of hundreds of millions of users. Providing high-quality services is an important part in pursuing a people-centered development philosophy. Next, we will focus on our work in three aspects.

First, we will enhance policy guidance to foster an enabling environment for the industry. We will take action to increase the service capacity of mobile applications so that both service supply and user experience will be improved. We will also build a public service platform involving mobile applications to efficiently support the regulation and development of the industry. In addition, we will develop sound systems to coordinate our work, strengthen the self-discipline of the telecom industry, and create an enabling environment for its healthy and orderly development.

Second, we will focus on key problems to address the concerns and aspirations of the people, such as personal information protection and telecom and internet fraud. We will strengthen the regulation of apps at all stages for all entities, urge app stores, terminals, and other key links to fulfill their primary responsibility, and realize joint prevention and governance throughout the industrial chain. We will also accelerate the establishment of a united resource database for the industry to combat fraud, and step up efforts to promote the service that enables citizens to inquire about all mobile phone cards registered under their own ID numbers. Integrated protection capacity will be enhanced, and a sound environment for information consumption will be jointly fostered.

Third, we will step up efforts to improve our capacity to benefit the public and provide more convenient services. We will advance online and cross-regional handling of telecom services, carry out consumer satisfaction measurement of key internet services, speed up the improvement of websites and apps with local features, and provide more comprehensive, considerate, and satisfactory ICT services. 

Thank you.

Shangyou News:

Rapid development of the green energy equipment industry is one of the important areas of forging new industrial competitive strengths of green and low-carbon industries. How did the situation of the green energy equipment industry develop in 2022? What new measures will be taken next to further boost the industry? Thank you.

Tao Qing:

Thank you for your questions. To develop the green energy equipment industry is an important measure to promote green and low-carbon development and achieve our carbon peak and neutrality targets. In recent years, the MIIT has worked with relevant departments to issue and implement an action plan to improve energy efficiency in industries, making a big push to develop the green energy equipment industry.

First, we have accelerated the promotion of high-efficiency and energy-saving equipment. We issued a catalog of selected and recommended energy-saving technologies and equipment in the field of industry and information technologies. Also, we moved faster to promote 133 pieces of energy-saving equipment, including high-efficiency electric motors, transformers, compressors, and draught fans.

Second, we have built up manufacturing capability and competitive production capacity in the whole industrial chain of renewable energy, including wind and photovoltaic power and lithium-ion batteries. At the end of 2022, China led the world with the photoelectric conversion efficiency of self-developed silicon heterojunction cells. The output of wind power generators in China accounted for two-thirds of the world's total. The single-unit capacity continued to grow, with the capacity of the latest developed onshore wind power generator exceeding 6 MW. In 2022, the newly installed capacity of wind and photovoltaic power reached more than 120 million kW, and their cumulative installed capacity exceeded 700 million kW, driving the installed capacity of renewable energy to exceed 1.2 billion kW.

Next, we will stick to our carbon peak and neutrality targets, implement the plan to improve the energy efficiency of electric motors and transformers, organize the compiling of the energy-saving technologies and equipment catalogs in the field of industry and information technologies, and hold a series of themed events at enterprises to promote energy conservation service. By speeding up the development of the green energy equipment industry and e-energy industry in the field of wind, solar, and hydroelectric power, hydrogen energy, and energy storage, we will push green and low-carbon development to a new level and make a positive contribution to the green transition in all respects of economic and social development.

Thank you.

People's Post and Telecommunications News:

We have seen that the ICT sector achieved steady and rapid growth in 2022. What are the main achievements? What other work considerations are there for this year? Thank you.

Zhao Zhiguo:

Thank you for your question. In 2022, the MIIT conscientiously implemented the decisions and plans of the CPC Central Committee and the State Council, made stability our top priority, and pursued progress while ensuring stability, promoting the high-quality development of the ICT sector to achieve new results with a strong sense of responsibility and mission.

The first achievement is that we have created new highlights, and the scale of the ICT industry has continued to grow. The annual telecommunications services revenue was 1.58 trillion yuan, a year-on-year increase of 8%, injecting impetus into economic growth empowerment and boosting market confidence. We continuously optimized the industry structure, with the revenue of emerging businesses such as internet data centers, cloud computing, and the Internet of Things increasing by 32.4% year on year, driving the growth of telecommunications services revenue by 5.1 percentage points and becoming an important growth pole of the telecommunications services. The effective investment was steadily expanded. The investment in telecommunications fixed assets for the year reached 419.3 billion yuan, a year-on-year increase of 3.3%, and the growth rate of investment remained stable. Consumption vitality was effectively stimulated, mobile internet traffic increased by 18.1% year on year, and national online retail sales reached 13.8 trillion yuan, a year-on-year increase of 4%, driving both the quantity and quality of information consumption to increase.

The second achievement is that we have consolidated the new base, and the infrastructure construction has achieved remarkable results. We worked in coordination to promote the "Double Gigabit" networks construction, and a total of 2.312 million 5G base stations have been built and the gigabit optical networks have been expanded to be able to cover more than 500 million households, realizing "every city is covered by the gigabit optical network" and "every county can access 5G services." We coordinated the layout of data and computing power facilities, with the total number of data center racks in use across the country now exceeding 6.5 million standard racks and the average annual growth rate of the total computing power exceeding 25% in the past five years. We continued to optimize internet network architecture, added five national-level internet backbone direct connection points, increased the interconnection bandwidth to 38T, built four new switching centers, and accelerated the formation of an all-round, multi-level, three-dimensional network interconnection architecture, with the network service performance reaching an internationally advanced level.

The third achievement is that we have opened up "a new track," and the process of industrial digitalization continues to accelerate. In terms of industries, the integration of information and communications applications has accelerated to expand and deepen in the fields of industry, medical care, education, and transportation. The number of virtual private networks in the 5G industry has exceeded 10,000, and the number of mobile Internet of Things connections accounts for 70% of the global total. The industrial internet has been fully integrated into 45 major categories of the national economy. In terms of individual users, the number of apps has exceeded 2.58 million, enriching various user needs in consumption, entertainment, social networking, travel, etc., and comprehensively improving quality of life, and promoting the formation of the world's largest and most active digital service market.

Going forward, the MIIT will thoroughly implement the spirit of the 20th CPC National Congress and the plans of the Central Economic Work Conference; ensure both development and security; focus on consolidating foundations, promoting applications, and ensuring security; and consolidate the leading position of the information and communications industry in a bid to serve the high-quality development of the digital economy.

The first is to build high-quality information infrastructure. We will accelerate the in-depth coverage of the "Double Gigabit" networks; implement gigabit city construction actions; build an integrated computing power infrastructure application system with cloud-edge-terminal collaboration and integration of computing, storage, and operation; launch the "Broadband Frontier" project for universal telecommunications services; and promote high-quality development of the mobile Internet of Things, smoothing the information artery.

The second is to cultivate high-level integrated innovative applications. We will vigorously promote the integrated application of new-generation ICT such as 5G and gigabit optical networks in information consumption, vertical industries, people's wellbeing, and digital government. We will also promote the large-scale application of the industrial internet so as to lead the high-end, intelligent, and green development of industries.

The third is to build a highly reliable network security line of defense. We will comprehensively promote the construction of basic telecommunications network security capabilities, deepen the construction of data security management systems and supervision practices in the field of industry and information technology, advance the development of network and data security industries, and improve the network security system based on the security of network facilities, focusing on data security and supported by the security industry.

Thank you.

Hong Kong Bauhinia Magazine:

SMEs provide important support for China's economic resilience and are related to overall economic and social development. May I ask how the operation and development of SMEs were in 2022? What measures did the MIIT introduce to help and solve the difficulties of SMEs? Thank you.

Tian Yulong:

Thank you for your question. I will answer this question. The whole of society pays close attention to SMEs. SMEs connect thousands of households and are also an important force in promoting innovation, employment, and improve people's livelihoods. Since 2020, due to the continuous impact of the epidemic, SMEs have been greatly impacted and faced difficulty in business operations. Under the strong leadership of the CPC Central Committee and the State Council, especially by giving full play to the role of the leading group of the State Council for promoting the development of SMEs, the MIIT, together with relevant departments, has introduced a series of policies and measures to help SMEs ease their difficulties and develop healthily and steadily. Some measures have been taken in the following aspects.

In terms of tax and fee reductions in 2022, tax cuts, fee reductions, tax refunds, and tax and fee deferrals added up to more than 4 trillion yuan for various market entities throughout the year, with about 4% being enjoyed by small and micro-enterprises. In terms of increasing financing, as of the end of November 2022, the national inclusive small and micro-enterprise loan balance reached 23.2 trillion yuan, a year-on-year increase of 23.7%. In addition, the National Small and Medium Enterprises Development Fund has led social capital to invest a total of 35 billion yuan, which has played a very good role in alleviating loan difficulties. In terms of corporate innovation, we have established a gradient cultivation system for high-quality SMEs, accumulatively cultivating 8,997 national-level "little giant" enterprises with high growth potential, advanced technology and strong market competitive edge, and over 70,000 provincial-level SMEs with such strengths. In terms of services, in 2022, we launched the "Together to Benefit Enterprises" service action for SMEs, organized various high-quality resources, and provided policies, management, and technologies. We have provided more than 50 million services to SMEs. Their feelings are good. At the same time, we actively carried out special actions to prevent and resolve payment arrears to SMEs and promote the clearing of undisputed arrears in the ledger. Recently, the office of the leading group issued "Measures for Assisting in Growth Stabilization, Structural Adjustment, and Capacity Enhancement of MSMEs." The move was reported in various news outlets. The document put forward 15 specific measures to help MSMEs solve difficulties and achieve high-quality, sustainable development, especially focusing on their current difficulties and problems and based on a dual strategy of both easing difficulties and providing service, and adjusting structure and building up capabilities in parallel.

With the support of these policies, the vast number of SMEs have continued to strive for self-improvement, rise up to challenges, and overcome various difficulties to achieve stable production and operations. According to the National Bureau of Statistics, from January to November 2022, the number, operating income, and total profit of industrial SMEs above the designated size increased by 10.5%, 6.0%, and 0.3% year-on-year, respectively, demonstrating SMEs' strong resilience and vitality. A survey conducted by MIIT of 43,000 SMEs shows that in 2022, nearly 40% of enterprises had new loans, more than 60% of enterprises invested in research and development, and more than 60% of enterprises invested in fixed assets, demonstrating their growing confidence in development. At the same time, we conducted a survey of more than 1,800 "little giant" enterprises with high growth potential, advanced technology and strong market competitive edge, and found that from January to November, the profit margin of operating income of "little giant" enterprises was 10.7%, which was 5.2 percentage points higher than that of industrial enterprises above the designated size.

In 2023, the difficulties and challenges for the stable development of SMEs remain big. In this regard, all departments and localities need to join efforts. In accordance with the plans of the Central Economic Work Conference, we will continue to work unswervingly both to consolidate and develop the public sector and to encourage, support and guide development of the non-public sector. We will further strengthen policies and measures to promote the high-quality development of SMEs, including improving the policies and environment for their development, providing better services, encouraging innovation and cultivating talents. 

Thank you.

Xing Huina:

If you have no more questions, today's briefing is hereby concluded. Thank you to the three speakers and friends from the media. Goodbye.

Translated and edited by Zhang Tingting, Li Huiru, Xu Xiaoxuan, Zhou Jing, Yan Bin, Yuan Fang, Li Xiao, Liu Sitong, Xu Kailin, Liu Qiang, Wang Qian, Zhu Bochen, Daniel Xu, and Tom Arnsten. In case of any discrepancy between the English and Chinese texts, the Chinese version is deemed to prevail.

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Read in Chinese

Speakers:

Kang Yi, commissioner of the National Bureau of Statistics (NBS)

Fu Linghui, spokesperson of the NBS and director general of the Department of Comprehensive Statistics of the NBS

Chairperson:

Shou Xiaoli, deputy director general of the Press Bureau of the State Council Information Office (SCIO) and spokesperson of the SCIO

Date:

Jan. 17, 2023

Shou Xiaoli:

Ladies and gentlemen, good morning. Welcome to this press conference held by the State Council Information Office (SCIO). Today, we are joined by Mr. Kang Yi, commissioner of the National Bureau of Statistics (NBS), who will introduce the situation and answer your questions. We also have with us Mr. Fu Linghui, spokesperson of the NBS and director general of the Department of Comprehensive Statistics of the NBS. 

Now, I'll give the floor to Mr. Kang for a brief introduction.

Kang Yi:

Ladies and gentlemen, friends from the media, good morning! Welcome to today's press conference. It's a great pleasure to meet you. I'll begin by introducing China's economic performance in 2022 and then answer your questions.

In 2022, faced with challenges of high winds and choppy waters in the global environment as well as arduous tasks to advance reform, promote development, and maintain stability at home, under the strong leadership of the Central Committee of the Communist Party of China (CPC) with Comrade Xi Jinping at its core, all regions and departments strictly implemented the decisions and arrangements made by the CPC Central Committee and the State Council, adhered to the general working guideline of making progress while maintaining stability, coordinated the work of epidemic prevention and control and economic and social development in an effective way, and responded to the internal and external challenges effectively. As a result, the national economy continued to develop despite downward pressure, the economic output reached a new level, employment and prices were generally stable, people's lives were continuously improved, new achievements were secured in high-quality development, and the overall economic and social development was stable and healthy.

According to preliminary estimates, the gross domestic product (GDP) was 121,020.7 billion yuan in 2022, an increase of 3% over last year at constant prices. Looking at industries at various levels, the value added of the primary industry was 8,834.5 billion yuan, up by 4.1% over last year; the value added of the secondary industry was 48,316.4 billion yuan, up by 3.8%; and the value added of the tertiary industry was 63,869.8 billion yuan, up by 2.3%. In terms of quarterly data, the GDP in the first quarter was up 4.8% year on year, up 0.4% in the second quarter, up 3.9% in the third quarter, and up 2.9% in the fourth quarter. The quarter-on-quarter growth of GDP in the fourth quarter stayed the same as in the third quarter.

First, the grain output increased and production of animal husbandry grew steadily. 

The total output of grain in 2022 was 686.53 million metric tons, an increase of 3.68 million metric tons over the previous year, or up by 0.5%. Of this total, the output of summer grain was 147.4 million metric tons, up by 1%, and that of early rice was 28.12 million metric tons, up by 0.4%. The output of autumn grain reached 511 million metric tons, up by 0.4%. By species, the output of rice was 208.49 million metric tons, down by 2%; wheat, 137.72 million metric tons, up by 0.6%; corn, 277.2 million metric tons, up by 1.7%; soybeans, 20.28 million metric tons, up by 23.7%. The output of oil-bearing crops was 36.53 million metric tons, up by 1.1%. The total output of pork, beef, mutton, and poultry in 2022 was 92.27 million metric tons, up by 3.8% over the previous year. Of this total, the output of pork was 55.41 million metric tons, up by 4.6%; beef, 7.18 million metric tons, up by 3%; mutton, 5.25 million metric tons, up by 2%; poultry, 24.43 million metric tons, up by 2.6%. The production of milk reached 39.32 million metric tons, up by 6.8% and that of eggs stood at 34.56 million metric tons, up by 1.4%. At the end of 2022, 452.56 million pigs were in stock, up by 0.7%, and 699.95 million pig were slaughtered in 2022, up by 4.3%.

Second, industrial production experienced sustained development, and high-tech manufacturing and equipment manufacturing grew by leaps and bounds. 

The total value added of industrial enterprises above the designated size increased by 3.6% over the previous year. In terms of sectors, the value added of mining was up by 7.3%, the value of manufacturing went up by 3%, and the value of production and supply of electricity, thermal power, gas, and water increased by 5%. The value added of the high-tech manufacturing and equipment manufacturing went up by 7.4% and 5.6%, respectively, 3.8 percentage points and 2 percentage points faster than the value added of industrial enterprises above the designated size. In terms of ownership, the value added of state holding enterprises grew by 3.3%, that of the share-holding enterprises went up by 4.8%, that of the enterprises funded by foreign investors and investors from Hong Kong, Macao, and Taiwan dropped by 1%, and that of private enterprises grew by 2.9%. By products, the production of new energy vehicles, mobile communication base stations, and industrial control computer and system grew by 97.5%, 16.3%, and 15%, respectively. In December, the total value added of the industrial enterprises above the designated size grew by 1.3% year on year, up by 0.06% month on month. In the first 11 months, the total profits made by industrial enterprises above the designated size were 7,718 billion yuan, down by 3.6% year on year.

Third, the service sector sustained its recovery with modern service industries demonstrating a sound momentum of growth. 

The value added of services went up by 2.3% year on year in 2022. The value added of information transmission, software, and information technology services and that of financial services grew by 9.1% and 5.6%, respectively. In December, the Index of Services Production went down by 0.8% year on year, the decline narrowed by 1.1 percentage points compared with that of the previous month. In the first 11 months, the business revenue of service enterprises above the designated size grew by 3.9% year on year, of which the revenues of the information transmission, software, and information technology services, scientific research and technology services, and health and social services went up by 8.3%, 8.3%, and 8.1%, respectively.

Fourth, the scale of market sales was basically stable with sales of basic living goods and online retail sales growing at a fast pace. 

In 2022, the total retail sales of consumer goods reached 43,973.3 billion yuan, down by 0.2% over the previous year. Analyzing by different areas, the retail sales in urban areas reached 38,044.8 billion yuan, down by 0.3%. The retail sales in rural areas stood at 5,928.5 billion yuan, the same as that of the previous year. Grouped by consumption patterns, retail sales totaled 39,579.2 billion yuan, up by 0.5%, and the revenue of food and beverage amounted to 4,394.1 billion yuan, down by 6.3%. Spending on basic living goods increased steadily, with the retail sales of grain, oil, and food and that of beverages by enterprises above the designated size growing by 8.7% and 5.3%, respectively, over the previous year. In 2022, the national online retail sales reached 13,785.3 billion yuan, growing by 4% over 2021. Specifically, the online retail sales of physical goods totaled 11,964.2 billion yuan, up by 6.2%, accounting for 27.2% of the total retail sales of consumer goods. In December, the total retail sales of consumer goods went down by 1.8% year on year, a decline narrowed by 4.1 percentage points than that of the previous month and a month-on-month decline of 0.14%.

Fifth, investment in fixed assets increased steadily, and investment in high-tech industries maintained a good momentum of growth.

In 2022, investment in fixed assets (excluding rural households) reached 57,213.8 billion yuan, up by 5.1% over the previous year. Specifically, infrastructure investment went up by 9.4%, manufacturing investment grew by 9.1%, and investment in real estate development declined by 10%. The floor space of commercial buildings sold reached 1,358.37 million square meters, down by 24.3%. The total sales of commercial buildings was 13,330.8 billion yuan, down by 26.7%. By industries, the investment in the primary, secondary, and tertiary industries went up by 0.2%, 10.3%, and 3%, respectively. Private investment went up by 0.9%. Investment in high-tech industries grew by 18.9%, 13.8 percentage points faster than total investment growth. Specifically, investment in high-tech manufacturing and high-tech services grew by 22.2% and 12.1%, respectively. Among investments in high-tech manufacturing, those in manufacturing of medical equipment, measuring instruments and meters grew by 27.6%, and electronics and communication equipment manufacturing grew by 27.2%. In terms of high-tech services, investment in services for transformation of scientific and technological achievements and investment in research, development, and design services went up by 26.4% and 19.8%, respectively. Investment in the social sector went up by 10.9%. Specifically, investments in health and education went up by 27.3% and 5.4%, respectively. In December, investment in fixed assets (excluding rural households) grew by 0.49% month on month.

Six, import and export of goods grew fast, and the trade structure continued to receive optimization.

In 2022, the total value of import and export of goods was 42,067.8 billion yuan, an increase of 7.7% over last year. The total value of export was 23,965.4 billion yuan, up by 10.5%; the total value of import was 18,102.4 billion yuan, up by 4.3%. The country registered a trade surplus of 5,863 billion yuan. The import and export of general trade goods increased by 11.5%, accounting for 63.7% of the total value of import and export, an increase of 2.2 percentage points compared with last year. The import and export of private enterprises grew by 12.9%, accounting for 50.9% of the total value of import and export, 2.3 percentage points higher than that of last year. The import and export of mechanical and electrical products grew by 2.5%, accounting for 49.1% of the total value of import and export. In December, the total value of import and export of goods was 3,771.3 billion yuan, up by 0.6% year on year. Specifically, the total value of imports was 1,610.6 billion yuan, up by 2.2%, the total value of exports was 2,160.7 billion yuan, down by 0.5%. 

Seventh, consumer price saw mild growth, and growth of producer prices for industrial products went down.

In 2022, the consumer price index (CPI) went up by 2% over last year. Grouped by commodity categories, prices of food, tobacco, and alcohol went up by 2.4%; prices of clothing grew by 0.5%; housing prices increased by 0.7%; prices of articles and services for daily use went up by 1.2%; transportation and communication prices were up by 5.2%; prices of education, culture, and recreation grew by 1.8%; medical services and health care prices went up by 0.6%; and prices of other articles and services increased by 1.6%. In terms of food, tobacco, and alcohol prices, pork went down by 6.8%, grain up by 2.8%, fresh vegetables up by 2.8%, and fresh fruits up by 12.9%. Core CPI excluding the prices of food and energy went up by 0.9%. In December, consumer prices went up by 1.8% year on year, and maintained the same level of growth month on month. In 2022, producer prices for industrial products went up by 4.1% over last year. It went down by 0.7% year on year in December, and down by 0.5% month on month. The purchasing prices for industrial producers went up by 6.1% over last year, and in December, it went up by 0.3% year on year, and down by 0.4% month on month.

Eight, employment was generally stable, and surveyed unemployment rate in urban areas dropped slightly.

In 2022, 12.06 million people in urban areas became newly employed, exceeding the expected annual goal of 11 million. In December, the surveyed unemployment rate in urban areas was 5.5%, 0.2 percentage point lower than the previous month. The surveyed unemployment rate of people with local household registrations was 5.4%, and that of people with non-local household registration was 5.7%. The surveyed unemployment rate of people with non-local agricultural household registration stood at 5.4%. Specifically, the surveyed unemployment rate of the people aged from 16 to 24 was 16.7%, 0.4 percentage point lower than that of the previous month; that of people aged from 25 to 59 was 4.8%, 0.2 percentage point lower than that of the previous month. The urban surveyed unemployment rate in 31 major cities was 6.1%, 0.6 percentage point lower than that of the previous month. The employees of enterprises worked 47.9 hours per week on average. In 2022, the number of rural migrant workers totaled 295.62 million, 3.11 million more than that of last year, up by 1.1%. Specifically, 123.72 million of them were local migrant workers working in the vicinity of their place of home, up by 2.4%; while 171.9 million worked at more distant places in their home province or in regions far away, up by 0.1%. The average monthly income of migrant workers was 4,615 yuan, up by 4.1% over last year.

Ninth, resident income grew generally at the same pace as economic growth, and income of rural residents grew faster than that of urban residents.

In 2022, the nationwide per capita disposable income of residents was 36,883 yuan, a nominal increase of 5% over that of last year, and a real increase of 2.9% after deducting price factors, which was generally at the same pace with the growth of the economy. In terms of permanent residents, the per capita disposable income of urban households was 49,283 yuan, a nominal growth of 3.9% and a real growth of 1.9% after deducting price factors. The per capita disposable income of rural households was 20,133 yuan, a nominal growth of 6.3% and a real growth of 4.2% after deducting price factors. The median of the nationwide per capita disposable income was 31,370 yuan, a nominal increase of 4.7% over that of last year. Taking the per capita disposable income of nationwide households by income quintile, that of the low-income group reached 8,601 yuan, the lower-middle income group 19,303 yuan, the middle income group 30,598 yuan, the upper-middle income group 47,397 yuan, and the high income group 90,116 yuan. In 2022, the nationwide per capita consumption expenditure was 24,538 yuan, a nominal growth of 1.8%, or a real decline of 0.2% after deducting price factors.

Tenth, total population declined and urbanization rate continued to grow.

By the end of 2022, the national population was 1,411.75 million (including the population of 31 provinces, autonomous regions, and municipalities, as well as military service personnel, but excluding residents of Hong Kong, Macao, and Taiwan and foreign nationals residing in the 31 provinces, autonomous regions, and municipalities), a decrease of 0.85 million over that at the end of 2021. In 2022, the number of births was 9.56 million with a birth rate of 6.77‰; the number of deaths was 10.41 million with a mortality rate of 7.37‰; the natural population growth rate was minus 0.6‰. In terms of gender, the male population was 722.06 million, and the female population was 689.69 million; the sex ratio of the total population was 104.69 males to 100 females. In terms of age structure, the population in the working age group from 16 to 59 was 875.56 million, accounting for 62% of the total population; the population aged 60 and over was 280.04 million, accounting for 19.8% of the total; the population aged 65 and over was 209.78 million, accounting for 14.9% of the total. In terms of urban-rural structure, permanent residents in urban areas totaled 920.71 million, an increase of 6.46 million over the end of the previous year; and permanent residents in rural areas amounted to 491.04 million, a decrease of 7.31 million. The share of urban population in the total population (urbanization rate) was 65.22%, 0.5 percentage point higher than that at the end of the previous year.

Generally speaking, positive results have been achieved in effectively coordinating COVID-19 prevention and control and economic and social development in 2022, with stabilized macroeconomic performance, continuously expanded economic output, and steadily improved development quality. However, the foundation of domestic economic recovery is not solid as the international situation is still complicated and severe, while the domestic triple pressure of demand contraction, supply shock, and weakening expectations is still looming. In the next stage, we must take Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era as the guideline, fully implement the guiding principles of the 20th National Congress of the Communist Party of China as well as the decisions and arrangements made by the Central Economic Work Conference, make economic stability our top priority, and pursue progress while ensuring stability. We will better coordinate epidemic prevention and control with economic and social development, ensure better coordination in pursuing development and upholding security, deepen reform and opening-up in all respects, boost market confidence and stabilize growth, employment, and prices, so as to promote overall improvement of economic performance, and achieve effective enhancement of quality and reasonable growth of quantity.

That's all for my introduction. Thank you.

Shou Xiaoli:

Thank you for your introduction, Mr. Kang. Now we will open the floor for questions. Please identify the media outlet you represent before raising a question.

CCTV:

China's economy was affected by multiple factors beyond expectations in 2022, including the international situation, domestic COVID-19 outbreaks, high temperatures and drought. What's your view on the performance of China's economy in 2022? Moreover, China's GDP surpassed 120 trillion yuan in 2022, so what does that mean for the Chinese economy? Thank you.

Kang Yi:

Thank you for your questions. It is indeed very important to review the past year. In 2022, we faced profound changes and a pandemic, both unseen in a century, the geopolitical situation was volatile and unstable, and downward risks in the global economy increased. Meanwhile, the domestic economy was affected by multiple factors beyond expectations, including sporadic resurgences of COVID-19 and extremely high temperatures. Moreover, the triple pressure of demand contraction, supply shocks and weakening expectations continued to evolve. Furthermore, the environment for development became more complicated, challenging and uncertain. Confronted with a complex and volatile international environment and formidable tasks in promoting reform, development, and stability at home, the CPC Central Committee with Comrade Xi Jinping at its core united and led the whole Party and Chinese people of all ethnic groups in rising to these challenges head-on and dealing with them calmly, considering both domestic and international dynamics, coordinating the COVID-19 response with socioeconomic development, ensuring both development and security, and stepping up macro regulation, and as the result, the impact of factors beyond expectation has been handled effectively, the overall performance of the macroeconomy has been stabilized, new achievements have been made in high-quality development, people's basic living needs have been ensured through more effective efforts, and overall economic and social stability has been maintained. Overall, the economy's performance in 2022 can be generalized in the following aspects.

First, China's composite national strength has been further strengthened. In 2022, China's GDP exceeded 120 trillion yuan, standing at 121 trillion yuan. After consecutively surpassing 100 trillion yuan in 2020 and 110 trillion yuan in 2021, China's GDP in 2022 reached a record high of 120 trillion yuan, or $18 trillion in U.S. dollar terms, according to the annual average exchange rate. China maintained its position as the world's second-largest economy. China's per capita GDP in 2022 reached 85,698 yuan, up 3% in real terms, amounting to $12,741, according to the annual average exchange rate. China's per capita GDP has exceeded $12,000 for two years in a row. The constant increase in China's GDP in both aggregate and per capita terms means a further enhancement in China's composite national strength, social productivity, international influence and people's living standards, which means a more solid foundation, higher quality, and greater momentum for development. Moreover, it demonstrates the Chinese economy's strong resilience, vast potential and ample space, and the fact that the fundamentals sustaining China's sound economic growth, in the long run, remain unchanged. Surely, it also means that we should continue to work with greater effort. The country's long-range goal for 2035 is to increase per capita GDP to the level of moderately developed countries. At present, the per capita GDP is only $12,700. The GDP needs to more than double to reach this medium-term goal. Therefore, 120 trillion yuan of GDP is only a small step on our way forward.

Second, the economy has remained generally stable. Economic growth was faster than most major economies. Early in the second quarter, affected by some factors beyond expectations, China faced an economic downturn. The CPC Central Committee and the State Council promptly adopted a package of policies to stabilize the economy, making great efforts to support the economy to withstand pressures and to firm up. Just now, I have reported to you that last year China's GDP grew by 3%, which is a fast growth rate compared with major economies in the world. For instance, Germany has announced its projected annual economic growth rate of 1.9%. According to the IMF, the economic growth rate of the U.S. and Japan in 2022 will not exceed 2%. China's GDP growth of 3% is relatively rapid, considering China has suffered shocks of many factors beyond expectation. In addition, overall stability was maintained in employment. A total of 12.06 million new urban jobs were created over the year, surpassing the projected target of 11 million new jobs. At the end of December, the surveyed urban unemployment rate stood at 5.5%, down 0.2 percentage points from the previous month. The consumer price index registered a moderate rise of 2% over the year. As global food and energy prices rose drastically and imported inflationary pressures increased, the stable prices in China contrasted sharply with the high inflation in major economies such as the U.S. and European countries. The balance of payments has been improved. The total volume of trade surplus in goods rose by 35.4% over the previous year; China's foreign exchange reserves reached $3.1277 trillion at the end of year, ranking first in the world.

Third, a solid foundation has been laid for industrial development. The agricultural sector has seen an increase in output and successful harvests. Moreover, a bumper food harvest has been secured for the 19th year in a row. The grain output totaled 686.55 million metric tons and has been kept above 650 million metric tons for eight consecutive years, putting us in a stronger position to ensure the food supply of the Chinese people. Meantime, industry has fully played its role as a ballast stone. The total industrial value added reached 40.2 trillion yuan and the value added by the manufacturing sector stood at 33.5 trillion yuan, leading the world. Industry's contribution to economic growth reached 36%. Infrastructure has been increasingly improved. As of the end of 2022, China's rail network in operation has grown to 155,000 kilometers, including 42,000 km of high-speed railways, leading the world. The world's largest internet infrastructure with world-leading technologies has been built and the industrial internet has been widely integrated into 45 categories of the national economy.

Fourth, domestic demand continued to expand. Despite the shocks of several rounds of COVID-19 resurgences, the total annual retail sales of consumer goods were stable at around 44 trillion yuan, with online retail sales reaching 12 trillion yuan. China is still the second-largest consumer market and largest online retail sales market in the world, with distinctive advantages in its huge market. The total investment in fixed assets exceeded 57 trillion yuan, up 5.1% over the previous year, 0.2 percentage points higher than that of 2021, providing strong support for sustained economic growth.

Fifth, reform and innovation have been deepened. Reforms to streamline administration and delegate power, improve regulation, and upgrade services have been advanced. The business environment has been improved. Moreover, steady progress has been made in the comprehensive pilot reform for the market-based allocation of production factors. In addition, the development of the high-standard market system has been accelerated. All these have contributed to creating a more favorable condition for the development of market entities. By the end of 2022, the number of market entities registered nationwide reached 169 million, including 114 million self-employed businesses. The innovation-driven development strategy has been further implemented and new development momentums have been playing an increasingly prominent role in driving growth. In 2022, the total value added of the high-tech manufacturing enterprises above designated size grew by 7.4% over the previous year, 3.8 percentage points higher than that of the industrial enterprises above designated size as a whole. Meanwhile, online retail sales of physical goods accounted for 27.2% of total retail sales of consumer goods, with a year-on-year increase of 2.7 percentage points.

Sixth, solid steps have been taken to advance high-standard opening up. Confronted with increasing downward pressure on the world economy and a slowdown in global trade growth, we have advanced high-standard opening up at a faster pace and supported enterprises to maintain production, receive orders and expand the market, achieving rapid growth in foreign trade and foreign investment. The total value of trade in goods reached a record high. In 2022, the total value of trade in goods exceeded 40 trillion yuan, reaching 42.1 trillion yuan, up 7.7% over the previous year. Trade in services grew rapidly. From January to November, the total volume of service trade stood at 5.4 trillion yuan, up 15.6% year on year. Inbound foreign investment grew in a trend-bucking manner. Bright economic development prospects and an increasingly optimized business environment made China a fertile ground for global investment and entrepreneurial pursuits. From January to November, China's utilized foreign investment amounted to 1.1561 trillion yuan, with a year-on-year increase of 9.9% calculated on a comparable basis, surpassing the whole year's total value of utilized foreign investment in 2021, hitting a record high.  

Seventh, strong and effective measures have been taken to ensure people's livelihoods. We have remained committed to ensuring and improving people's livelihoods through development, using every possible means to boost personal incomes, consistently increasing investment in improving people's living standards, and taking practical measures to meet people's basic living needs. Personal incomes have grown steadily. In 2022, per capita disposable income of residents increased by 2.9% in real terms, which stayed basically in step with economic growth. The government provided stronger support to ensure personal incomes, with a year-on-year nominal increase of 5.5% in per capita net transfer income, higher than the growth rate of total personal incomes. Investment in improving people's livelihoods was increased and social sector investment in 2022 went up by 10.9% year on year, among which investment in health and social work was up by 26.1%, an increase of 6.6 percentage points over the previous year.

People can't know how difficult things can be until they have experienced them. Under the complicated circumstances of profound changes and a pandemic both unseen in a century and faced with shock caused by many unexpected factors, it is only by overcoming enormous difficulties that China has been able to make such achievements. We owe our achievements last year to the strong leadership of the CPC Central Committee with Comrade Xi Jinping at its core, the sound guidance of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, and the concerted efforts of the Party and Chinese people of all ethnic groups. These achievements speak volumes about the marked advantages of the system of socialism with Chinese characteristics and the strong resilience and vitality of the Chinese economy.

While fully recognizing our achievements, we also need to acknowledge that the international situation is undergoing complex changes, the global growth momentum is weakening, global trade faces grim challenges, and the world economy may suffer from stagflation. Domestically, the foundation for economic recovery is still not solid and enterprises still face many difficulties in their production and operations. Our capacity for scientific and technological innovation still needs to be further developed. Moreover, people still face many difficulties in seeking jobs. More intensive efforts are required to promote overall improvement in the economy. 

Thank you.

Kyodo News:

What's your forecast for economic goals and prospects in 2023? China has put an end to the dynamic zero-COVID approach, opened up its economy, and started to resume work and production. What progress has been made?

Kang Yi:

Thank you for your questions. This year will kick off our efforts to put all the guiding principles from the 20th CPC National Congress into action and it is also a crucial year for continuing to implement the 14th Five-Year Plan. The external environment is complicated and challenging, the global economy faces rising risks of stagflation and the foundation for economic recovery in China still needs to be consolidated. However, the Chinese economy's strong resilience, ample potential and strong vitality and the fundamentals sustaining China's sound economic growth, in the long run, remain unchanged. Moreover, the country's resources and production factors can provide enough support. With China's COVID-19 response moving into a new phase and policies continuing to be implemented fully and meticulously, work and life are expected to return to normal at a faster pace and the internal drivers of China's economy will gather greater momentum. In 2023, China's economy will see overall improvement. According to our analysis of the economy in 2023, there are some advantageous conditions, which are as follows:

First, China has a solid material foundation that has been built up over the years. China possesses all the industrial categories listed by the U.N. and features the best industrial supporting conditions. It has a strong capacity for industrial organization and resilient industrial chains. Therefore, China plays a crucial role in the global industrial division system and the global supply chain system. Infrastructure in China is well developed. In response to the fluctuations in the global supply system, we have enhanced our capacity to ensure security in key areas, including food, energy, and industrial and supply chains, creating favorable conditions for dealing with external risks and challenges.

Second, China enjoys the distinctive advantages of a super-sized domestic market. There are more than 1.4 billion people in China. New industrialization and urbanization continue to advance. China has a super-sized domestic market with the greatest potential in the world, serving as a powerful engine for promoting economic recovery.

Third, new growth drivers have played a stronger role in supporting the economy. We have further implemented the innovation-driven development strategy, worked hard to reinforce China's strategic science and technology capabilities, and taken effective measures to advance the rapid development of new industries. All these will provide new driving forces for economic growth. 

Fourth, the dividends of efforts to deepen reform and opening-up continue to be unleashed. We uphold and further improve the basic socialist economic system and work unswervingly to both consolidate and develop the public sector and to encourage, support and guide the development of the non-public sector. We have strived to accelerate the development of a unified domestic market, deepened reforms to streamline administration, delegate power, improve regulation and strengthen services, and fostered an internationalized and law-based business environment, and created a more level playing field for various market entities.

Fifth, China has rich experience in macro regulation. In particular, current prices are generally stable and under control, leaving ample space for us to reserve and utilize policy tools for macro regulation in many ways.

In 2023, China's economy will certainly see an overall improvement. I believe you have seen the current situation of epidemic response and resumption of work and production. Taking Beijing as an example, traffic congestion has returned. And the number of domestic flights surpassed 80% of the level in 2019. People have returned to normal life. All these factors will create better conditions for economic growth in 2023.

Thank you.

Reuters:

According to the statistics, in 2022, the total retail sales of consumer goods dropped by 0.2% over the previous year. In December, it went down 1.8% year on year. For this year, what effective measures will be taken to boost consumption, especially consumer spending? Moreover, what were the respective contributions of the three key demands for economic growth? Thank you.

Kang Yi:

Thank you for your questions. Consumption is a topic concerning everyone. Expanding domestic demand remains one of our top priorities this year.

Last year, the entire consumer market was hit hard by the epidemic. Especially due to the restrictions on cluster and in-person consumption, the overall consumer market was greatly impacted. In addition, people have become less willing to consume. The problems of being afraid and inconvenient to consume have become prominent. Total retail sales of consumer goods decreased by 0.2% last year, and the consumer market was significantly affected by the short-term disruption of the epidemic. Under such circumstances, we immediately launched a set of policies to boost consumption and basically stabilized the domestic consumption market with some new changes emerging. For example, overall sales margin improved in December. Total retail sales of consumer goods dropped by 1.8% in December. Compared to the decrease of 5.9% in November, as we reported, it narrowed by 4.1 percentage points. Some new types of consumption have developed rapidly. Online retail sales have made up an increasing share. Specifically, online retail sales of physical goods accounted for 27.2% of the total retail sales of consumer goods in 2022, 2.7 percentage points higher than the previous year. People tend to have an increased demand for higher-quality goods or services. All of the above are the characteristics of our country's consumption over the past year. 

We have full confidence in China's consumer market in 2023. As China's epidemic response enters a new phase, production and life have gradually returned to normal, and consumer spending on brick-and-mortar businesses will gradually pick up. The consumer market is expected to recover in a steady manner. Here are some favorable conditions.

First, there is huge spending potential among Chinese consumers. There is a huge consumer demand with a population of more than 1.4 billion. At the same time, the general trend of the consumption structure upgrading has remained unchanged. Second, offline and service spending is gradually returning to normal. As production and life accelerate the pace of recovery, restrictions on consumption scenarios will be greatly reduced, creating favorable conditions for the recovery of service consumption and in-person consumption. Third, new consumer hotspots are emerging. New consumption models such as "internet plus" and "digital plus" have developed rapidly. Consumers tend to spend more on a green lifestyle, fitness, health care, and cultural products and services. Fourth, a stable job market and rising household income will also promote consumer spending. I mentioned that China's overall economy would definitely improve in 2023 when we looked at the outlook of China's economy in the next year. Economic recovery will improve employment and people's income and greatly boost consumers' capacity and willingness to spend.

At the end of last year, the National Development and Reform Commission issued a mid- and long-term plan to boost spending and domestic demand and made a series of arrangements for expanding the domestic market, promoting consumption, expanding employment, raising income, improving income distribution, perfecting income distribution pattern, facilitating consumption, and combining expanding domestic demand with deepening supply-side structural reforms. The implementation of these policies will continuously enhance people's spending power and promote the recovery, improvement, and scale of the consumer market in a steady manner.  

Regarding the contributions made by the three key demands for economic growth, final consumption expenditure, capital formation, and net exports of goods and services drove economic growth by 1 percentage point, 1.5 percentage points, and 0.5 percentage points, respectively; and they were responsible for 32.8%, 50.1%, and 17.1% of economic growth, respectively.

Thank you.

21st Century Business Herald:

I would like to ask, how do you view China's performance in achieving its 2022 employment goals? With the number of college graduates expected to hit a new record high in 2023, how will you better achieve the goal of stable employment? Thank you.

Kang Yi:

Employment has always been a topic concerning everyone. In 2022, due to the resurgence of the pandemic, small and medium-sized enterprises have been faced with increasing operating difficulties. It has also become difficult for key groups to find jobs, especially among the youth, where there are rising unemployment rates, which has brought challenges to realizing stable employment. Employment matters most in people's lives. The CPC Central Committee and the State Council have attached great importance to this issue and introduced a series of effective measures to stabilize employment. All localities and government departments have adhered to the principle of giving priority to employment, intensified the effect generated by the policy of stabilizing and expanding employment, taken measures to ensure employment for key groups, made every effort to stabilize employment, and safeguarded the bottom line of preventing large-scale unemployment. It has demonstrated the following characteristics.

First, the employment situation is generally stable. China created 12.06 million new urban jobs, exceeding its target of 11 million set at the start of the year. Due to the spread of the pandemic, the surveyed urban unemployment rate rose temporarily in particular months, reaching 6.1% at its peak. However, for the year overall, the unemployment rate remained basically stable. Notably, the employment situation has improved recently as the package of policies to stabilize the economy, and subsequent policies, have taken effect. The surveyed urban unemployment rate was 5.5% in December, dropping by 0.2 percentage points from November.

Second, effective measures have been taken to ensure the employment of key groups. A series of policies targeted toward helping enterprises create jobs and keep their employees have been adopted, which are helpful in facilitating college graduates and migrant workers to find jobs. In December, the surveyed urban jobless rate for the people holding junior college degrees or above between the ages of 20 and 24 was 21.1%, falling by 0.2 percentage points from November, the fifth consecutive month that the rate has decreased. The drop in urban joblessness for those between the ages of 16 and 24 was even more significant. Meanwhile, the surveyed unemployment rate for rural migrant workers was 5.4%, a drop of 0.6 percentage points from the previous month. The number of migrant workers reached 295.62 million in 2022, an increase of 3.11 million from 2021, surpassing 2019's pre-COVID levels. Moreover, over 32 million laborers who have been lifted out of poverty found employment, and rural and urban people facing difficulties also found jobs.

Generally speaking, the overall employment situation remained stable in 2022. The surveyed urban jobless rate increased slightly compared with 2021 levels, which was due to multiple unexpected factors at home and abroad. Going forward, the pressure on the job market remains, with more than 11.5 million college students expected to graduate this year and ongoing prominent structural problems. However, the overall employment situation is expected to improve in 2023 as the economy recovers, which will lead to expanded demand for employment and more jobs becoming available. First, thanks to optimized COVID-19 containment measures, people's lives are getting back to normal, and enterprises will gradually resume work and production, promoting employment demand. Second, service sectors, ranging from accommodation and catering to tourism, will recover as public transport, logistics, and travel rebound. Service sectors have a large capacity for employment, so more job opportunities will be created in the rebound and development of these sectors. Third, governments and departments at all levels will continue to enhance pro-employment policies, implementing measures to ease the burden of enterprises, keep their employees, and create more jobs. Such stepped-up efforts will provide employment support for key groups, including college graduates, and ensure employment stability. Fourth, the rapid growth of the new drivers will continue to create more new jobs, which will serve as an important driver to expand employment and ensure high-quality employment. Thank you. 

Swiss Radio:

Looking back to consumption, will there be further measures taken to enhance consumption to turn it around?

Kang Yi: 

Consumption has become a concern for everyone. I have talked about this just now, so I'd like to invite Mr. Fu to give you more information. 

Fu Linghui:

Consumption has been of great concern for everyone. Given the complicated and grim situation, governments and departments at all levels adopted a series of policies to promote consumption last year. In 2023, China released medium- and long-term policies to further expand domestic demand. Then, governments and departments at all levels are expected to play a bigger role in spurring consumption in a bid to expand domestic demand and promote economic recovery. As the pandemic containment has entered a new phase, the entire environment is more favorable for consumption, and people with increased spending power are more willing to spend. Recovery of consumption is expected to see good momentum this year, which will help China's economy to deliver a better performance. Thank you. 

Yicai:

What do you think of fixed asset investment in 2022? The growth rate of investment has been declining despite the country's policies and measures to ensure growth and investment stability. What's behind this decline? What do you think of these investments going forward? Thank you. 

Kang Yi:

Thank you. Fixed asset investment played an important role in stabilizing the economy in 2022, with capital formation accounting for 50.1% of the country's GDP growth. In 2022, fixed asset investment witnessed steady growth, up 0.2 percentage points from the previous year. All regions and all government departments made great efforts to ensure the construction of the key projects. Stepped-up endeavors have been made to shore up weak links and accelerate the issuance and use of local government special bonds. Policy-based and developmental financial instruments have been made good use of. In this way, fixed asset investment has maintained stable growth, with its structure being improved. Investment has played a key role in keeping growth stable and promoting structural adjustment.  

Investment continued to expand, reaching 57.2 trillion yuan. Investment in the manufacturing sector grew rapidly, with a year-on-year growth of 9.1% in 2022, 4 percentage points faster than that of the national investment. The investment in manufacturing technology transformation increased by 8.4%, accounting for 40.6% of the total investment in the manufacturing sector, with its share surpassing more than 40%. Investment in infrastructure continued to accelerate, with investment in infrastructure growing by 9.4% year on year. The share of investment increase in water conservancy management was 13.6%, public facilities management was 10.1%, and information transmission was 9.3%. Investment in high-tech industries also witnessed rapid growth, up 18.9% from the previous year. Such growth is 13.8 percentage points faster than that of the national investment. The growth rate for high-tech manufacturing was 22.2%, and the rate for high-tech services was 12.1%. Moreover, investment in areas that are important to people's lives witnessed rapid increases, up 10.9% year on year, with the investment in health and social work increasing by 26.1%.

Generally, fixed investment remains stable but has new features. Driven by the demand side in the short term but by the supply side in the medium and long term, fixed investment requires the synergy of both supply and demand. This year, fixed investment is expected to continue to expand, considering the following aspects.

First, the investment potential of building a modern socialist country in all respects is huge. As the largest developing country in the world, China still faces a huge gap with developed countries in development levels on a per capita basis. China's per capita GDP is less than one-fifth of that of the U.S. and one-third of that of Japan. China's per capita infrastructure capital stock is only 20% to 30% of that of developed countries, and the space for development is huge.

Second, making up for disadvantages and strengthening weaknesses provides broad investment space. The problem of China's imbalanced and inadequate development is still prominent. The development gaps between urban and rural areas and between regions are relatively big and some rural areas in central and western China are lacking in infrastructure. Shoring up weak links implies broad investment space. Imbalances also exist in urban areas, and many weak points need to be strengthened. 

Third, the momentum of investment in innovative development is strong. In recent years, the high-tech manufacturing industry, represented by electronic medicine and the high-tech service industry, represented by e-commerce, have maintained sound growth. These industries still have great potential in the future. 

Fourth, infrastructure investment has been strengthened. The transformation and upgrading of traditional technological facilities, including transportation, energy, and water conservancy and the accelerated construction of new infrastructure such as 5G, extra-high voltage, intercity freeways and big data centers will drive effective investment. In terms of leading indicators, the total planned investment of projects starting construction in 2022 grew 20.2% year on year, with a growth rate of over 20% for four straight months. In December, the number of newly registered fixed assets investment projects was 38,000, up 7.5% from November. Considering these indicators, investment in 2023 has a solid foundation.

Generally speaking, China's investment has development potential, space and momentum, and is expected to sustain growth. Thank you. 

Financial Times:

Can you provide information on China's death rate in December 2022 and how it compares with December 2021? Thank you. 

Kang Yi:

Thank you for your question about population, which is of great concern to many. I will introduce it from the perspective of demographic statistics. China conducts a population census every 10 years, or at the end of each decade. The latest census, also the seventh, was conducted in 2020. In non-census years, demographic statistics use survey sampling methods. At midnight on Nov. 1 each year, survey sampling is conducted in order to identify demographic changes. Therefore, the total population, births and deaths for the whole year are calculated. Thank you.

CNBC: 

Last year saw a decline in real estate and exports. In terms of statistics, is there any new growth driving force for sustainable economic development to offset the factors leading to the decline? Thank you. 

Kang Yi:

Thank you for your question about real estate and exports. First, I will brief you on the real estate situation in 2022. With a long industrial chain and affecting many aspects, the real estate industry greatly influences the national economy. According to our calculations, real estate and its relevant industries account for 13% or 14% of total GDP. In 2022, the value added of the real estate industry decreased by 5.1%, affecting many indexes. Due to the impact of the real estate industry, the 5.1% growth rate of fixed investment is not very fast. The 10% reduction in real estate investing led to a decline of 2.5 percentage points in fixed assets investment. Affected by the real estate sector, private investment increased by 0.9%. Private investment accounts for about 80% of real estate investment. Therefore, the decline of 10% in the latter has a big downward influence on the former. Manufacturing investment in private investment grew by double digits. Private investment has a large proportion of real estate investment, which has had a great downward impact on the former. Fluctuations in the real estate market are normal. 

According to the latest situation, the country released a series of relevant policies to construct a new real estate system, as we have noticed. In December, the decline in all indexes in the real estate industry slowed down, with new factors coming into being. The decline in real estate investment in December was 7.7 percentage points smaller than that of November. Declines in the sold floor space of commercial buildings, sales volume, capital in place, and the floor space of houses beginning construction narrowed to different degrees. Therefore, we initially estimated that the impact of the real estate industry on the economy in 2023 would not be greater than that in 2022. Real estate remains a pillar industry, and conditions are favorable for the steady recovery of the real estate market. With urbanization still in development, China saw an increase of half a percentage point in its urbanization rate to 65.22% last year, still lower than 80% of developed countries. The newly added urban population was huge last year, which implies future development space. Policy adjustment in supply and demand aims to emphasize that housing is for living in, not for speculation, and reduce the financial function of real estate. Besides, guarantee and supply are provided in multiple channels from various parties, which will help establish a new healthy real estate market. 

Policies concerning the demand side to support justified and improved housing needs will effectively support the real estate industry. The demand for improved living conditions is substantial. As the pillar industry for developing and developed countries, the real estate industry has a tremendous influence on the economy. Thank you. 

Economic Daily:

China will conduct its fifth national economic census in 2023. How is the work going? What improvements will be made to the upcoming national economic census compared with the previous one? Thank you.

Kang Yi: 

Thank you for your questions and for allowing us to share more information about the fifth national economic census with the public. First, I will introduce the progress we have made in conducting the upcoming national economic census. The State Council issued a notice on carrying out the fifth national economic census on Nov. 17 last year to jump-start the work. The fifth national economic census is a major survey of national conditions and national strength carried out in the critical period of the beginning of building a modern socialist country in all aspects after the success of the 20th CPC National Congress. It's fair to say that this is also the first major survey on national conditions and national strength in the journey towards building a modern socialist country in all aspects, following the achievement of building a moderately prosperous society in all aspects. The NBS has thoroughly implemented major decisions and arrangements on statistical work deployed by the CPC Central Committee and the State Council, regarding the fifth national economic census as a major statistical task, and making solid progress in the planning and coordination of the census.

First, we have carefully planned the general idea of the census and coordinately arranged the input-output survey. The NBS regards carrying out the economic census and input-output surveys in a coordinated manner as a major statistical task, as part of the Plan for Modernizing Statistical System during the 14th Five-year Plan period. In the second half of 2021, we launched special pilot projects in six regions, including Shanxi province, to evaluate the feasibility and necessity of coordinating the two surveys. We have concentrated on the service of the new development stage, promoted high-quality development, closely focused on the task of modernizing statistical system, and formulated the general idea of the fifth national economic census on the basis of extensively soliciting opinions from all sectors and in-depth discussions.

Second, we have completed special pilot projects and made solid progress in making plans for the census. From June to September 2022, the NBS carried out special pilot projects in 14 provinces, autonomous regions, and municipalities, including Beijing, Tianjin, and Hebei, focusing on solving key and tricky problems and testing new content, methods and technologies for the census. Based on the results of the special pilot projects, we have formed the draft of the plan for the fifth national economic census. Currently, we are widely soliciting opinions about the draft plan from within statistical systems and relevant departments. 

Third, we have strengthened coordination among departments to promote the implementation of arrangements for the census. As a massive social system project, the economic census requires the close cooperation of all sectors of the whole society. Now, all regions across the country have started implementing census work in their localities.

Your second question is about the differences between the fifth national economic census and the previous one. First, the upcoming census marks our first time conducting input-output surveys in a coordinated manner. As an objective requirement to promote high-quality development, census and survey work is an important measure in advancing the modernization of statistical system and the national economic accounting reform, as well as in consolidating the quality of statistical survey data. It is not only convenient to coordinate survey tasks, integrate survey contents, optimize survey items, and reduce the burden of grassroots work, but also conducive to a more comprehensive and systematic collection of grassroots data, the coordination of statistical survey data, and better verification of relevant data, ultimately achieving a better connection between economic aggregate and structural data.

Second, we will further innovate the means and methods used for conducting the census and survey. This national economic census will widely use administrative records of departments to promote the application of electronic licenses and certificates during the process. We will also adopt new ways to carry out the census, combining online filling with handheld electronic terminals and on-site data collection. We will also encourage census respondents to submit census data via the internet.

Third, we will launch inspections on the census in due time. We will firmly hold the lifeline of census data quality, strictly implement the census plan, standardize the work process of the census, strengthen the inspection and verification of data quality throughout the whole process, and effectively prevent and punish behaviors of statistical fraud and fake statistics. We will include the census situation in the content of statistical inspections at an appropriate time.

For the next year, in accordance with the decisions and arrangements of the CPC Central Committee and the State Council, the NBS will steadily advance the establishment of census institutions, the construction of comprehensive pilot projects, the inventory work of various units, and the preparation work for census registration, to lay the foundation for the smooth implementation of the fifth national economic census and successfully complete the tasks of this year's census. The census will be a "comprehensive physical examination" of the national economy. With this, I would like to call for more support, understanding, participation and cooperation from every respondent engaged in this census. We also hope that our media friends will actively promote, support and supervise the census work.

Shou Xiaoli:

Due to time limitations, we can only answer two more questions.

Bloomberg News: 

My first question is about the unemployment rate. The unemployment rate usually rises in December, based on the last five or seven years. But this year, it fell. How do you explain that change in the historical pattern of unemployment, especially considering that in December, most of China seemed to have COVID-19 and economic activity was very, very limited? My second question is related to the question from the Financial Times. Will you be releasing monthly death data in the coming months, considering how much interest there is in how many people have died and how fast that is increasing? Thank you.

Kang Yi:

Thank you for your questions. Everyone pays close attention to the issue of employment and unemployment, and you have also been very careful to analyze China's urban survey unemployment rate data released every December for many consecutive years. In December 2022, the unemployment rate in China's urban survey fell by 0.2%, mainly due to the decline in the labor participation rate. In December, the labor participation rate fell by 1.1 percentage points, because migrant workers returned home. Moreover, some were recuperating at home after COVID-19 infections, and their willingness to participate in work was low, which was the main reason for the decline in the labor participation rate.

As for the second question, on Jan. 14, the State Council's Joint Prevention and Control Mechanism held a press conference on the current situation. Since the outbreak of the pandemic, China has shared its data on the pandemic, including information on infections and other aspects, with the world, its people and relevant institutions at the earliest opportunity. Since the pandemic prevention and control entered a new stage, relevant data will be released according to the relevant provisions of the Law on the Prevention and Treatment of Infectious Diseases and according to the rules that manage Class B infectious disease, as COVID-19 management was downgraded from Class A to Class B.

Thank you.

Tianmu News:

As you mentioned just now, in the context of high global inflation, we can see that the current price data in China is still relatively stable and moderate. What is the reason for this? What is your anticipation for the price trend in 2023? Thank you.

Kang Yi:

The stable operation of prices is not only conducive to the stable performance of the economy, but also conducive to ensuring people's livelihoods. China's prices remained generally stable last year, with the annual CPI rising by 2%, lower than the expected target of 3%. There were many reasons for this.

First, China did not issue excess currency, and prices still reflect the relationship between supply and demand. Let's compare China's situation with that of other countries and regions. The US has continuously raised interest rates to curb inflation, and its CPI rose 6.5% in December. Europe's CPI rose at the sharp level, still more than 10%. Japan's CPI has also been rising recently. During the past three years of pandemic prevention and control, China has not flooded its economy with liquidity. This is the first reason.

Second, the effects of ensuring supply and stabilizing prices have become apparent. Geopolitical conflicts and rising energy prices are significant factors that contribute to imported inflation. We first ensured the energy supply, such as the coal supply, which reached a total output of 4.5 billion tonnes in 2022. The stable supply of coal ensured the power supply. Also, the grain price. China's grain output has been stable at more than 1.3 trillion jin (650 million tonnes) every year for eight consecutive years, achieving "19 consecutive-year harvests." A rise in food prices would drive up the prices of many commodities. According to the requirements of General Secretary Xi Jinping, we must secure our own food supply for the Chinese people. With a population of more than 1.4 billion, if our food supply were insufficient, we would have to purchase grains on the international market, which would drive international food prices even higher. We have provided a solid foundation to stabilize the supply and prices of grains, energy and other major commodities.

Third, the supply of industrial goods and services is sufficient. As I said just now, it reflects the relationship between supply and demand. China's complete industrial system and adequate supply of goods and services contribute to the stability of consumer prices.

In 2023, there is no basis for a sharp rise in prices. We are confident that the CPI trend will remain stable in the new year. Thank you.

Shou Xiaoli:

Today was Mr. Kang's first time attending our press conference at the State Council Information Office. Thank you to all the speakers and thank you to all the reporters for your participation. That's all for today's press conference.

Translated and edited by Yang Xi, Liu Jianing, Xu Kailin, Liu Sitong, Wang Qian, Zhang Rui, Wang Yanfang, Qin Qi, Li Huiru, Gong Yingchun, Zhou Jing, Huang Shan, Daniel Xu, Tom Arnsten, and Jay Birbeck. In case of any discrepancy between the English and Chinese texts, the Chinese version is deemed to prevail.

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Read in Chinese

Speakers:

Mr. Xuan Changneng, deputy governor of the People's Bank of China (PBC)

Ms. Ruan Jianhong, spokesperson of the PBC and director general of the Statistics and Analysis Department of the PBC

Mr. Zou Lan, director general of the Monetary Policy Department of the PBC

Mr. Ma Jianyang, an official of the Financial Market Department of the PBC

Chairperson:

Shou Xiaoli, deputy director general of the Press Bureau of the State Council Information Office (SCIO) and spokesperson of the SCIO

Date:

Jan. 13, 2023

Shou Xiaoli:

Ladies and gentlemen, good afternoon. Welcome to the second press conference held by the State Council Information Office (SCIO) this afternoon. We have invited Mr. Xuan Changneng, deputy governor of the People's Bank of China (PBC), to brief you on China's financial statistics in 2022 and take your questions. Also joining us today are Ms. Ruan Jianhong, spokesperson of the PBC and director general of the Statistics and Analysis Department of the PBC; Mr. Zou Lan, director general of the Monetary Policy Department of the PBC; and Mr. Ma Jianyang, an official of the Financial Market Department of the PBC.

Now, I will give the floor to Mr. Xuan Changneng.

Xuan Changneng:

Friends from the media, good afternoon. In 2022, faced with unexpected factors at home and abroad, under the strong leadership of the Central Committee of the Communist Party of China (CPC) with Comrade Xi Jinping at its core, the PBC firmly acted on the decisions and deployments of the CPC Central Committee and the State Council and the requirements of the Financial Stability and Development Committee under the State Council, stepped up the implementation of prudent monetary policies, adopted the policy package and follow-up policies for keeping the economy stable, took solid measures to serve the real economy, and made resolute contributions to maintaining a stable macroeconomic performance. On Jan. 10, the PBC released the Financial Statistics Report (2022). The data shows that China's financial system operated smoothly in 2022, and the financial sector provided stronger and higher-quality support for the real economy.

First, liquidity in the banking system maintained reasonably ample, and the growth in total credit became more stable. In 2022, the PBC lowered the required reserve ratio (RRR) twice, providing the real economy with more than 1 trillion yuan in long-term liquidity; turned in surplus profits of over 1.13 trillion yuan; and used various methods such as re-lending and rediscounting, medium-term lending facilities, and open market operations to release liquidity, thus creating a favorable liquidity environment for keeping the macroeconomic performance stable. Broad money supply (M2) increased by 11.8% year on year, 2.8 percentage points higher than that at the end of the previous year. RMB loans grew by 21.31 trillion yuan, surpassing the amount recorded in 2021 by 1.36 trillion yuan. Aggregate financing in the economy increased by 9.6% – 32.01 trillion yuan – year on year, which was 668.9 billion yuan more than that in the previous year.

Second, credit support for key fields and weak links of the real economy was strengthened. The credit structure was continuously improved. In 2022, the PBC introduced a range of targeted structural monetary policy tools for groups in difficulty and key fields, helping to keep the macroeconomic performance stable. The outstanding balance of loans to the manufacturing industry increased by 36.7% year on year, 25.6 percentage points higher than the growth rate of loans overall. The outstanding balance of loans to small- and medium-sized scientific and technological enterprises increased by 24.3% year on year, 13.2 percentage points higher than the growth rate of loans overall. The outstanding balance of loans to specialized and sophisticated enterprises that produce new and unique products increased by 24% year on year, 12.9 percentage points higher than the growth rate of loans overall. The outstading balance of inclusive loans to micro and small businesses increased by 23.8% year on year, 12.7 percentage points higher than the growth rate of loans overall. A total of 56.52 million micro and small businesses received the inclusive loans, a year-on-year increase of 26.8%. At the same time, the PBC guided policy and development banks to free up 739.9 billion yuan through policy and developmental financial instruments, and made full use of 800 billion yuan in new credit quotas to mainly support infrastructure development. By the end of 2022, the outstanding balance of medium- and long-term loans to the infrastructure sector increased by 13% year-on-year, 1.9 percentage points higher than the growth rate of loans overall.

Third, overall financing costs of the real economy dropped significantly. While major European and American economies raised interest rates sharply and swiftly, China's loan prime rate (LPR) reforms continued to deliver benefits. The one-year and five-year LPRs were lowered by 15 and 35 basis points, respectively, helping to reduce overall financing costs of the real economy. In 2022, the weighted average interest rate on newly issued corporate loans was 4.17%, 34 basis points lower than the previous year. Meanwhile, the PBC established a market-based adjustment mechanism for deposit interest rates to keep the cost of bank liabilities stable. In 2022, the weighted average interest rate of new time deposits was 11 basis points lower than that of the previous year.

The year 2023 is the start of fully implementing the guiding principles of the 20th CPC National Congress. The PBC will follow the guidance of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, thoroughly act on the guiding principles of the 20th CPC National Congress and the Central Economic Work Conference, work unswervingly both to consolidate and develop the public sector and to encourage, support, and guide development of the non-public sector, stay committed to the general principle of pursuing progress while ensuring stability, make prudent monetary policy more targeted and effective, focus on expanding effective demand and deepening supply-side structural reform, and contribute to high-quality and moderate economic growth.

Thank you.

Shou Xiaoli:

Now we will open the floor for questions. Please identify the media outlet you represent before raising a question.

Reuters:

The Central Economic Work Conference stressed that the prudent monetary policy should be targeted and effective this year, with reasonable and sufficient liquidity to be maintained. In this context, is there room to further cut interest rates and RRR? Will structural tools be used more? Thanks.

Xuan Changneng:

As mentioned in my opening remarks, the prudent monetary policy aims to ensure better coordination in expanding domestic demand and advancing supply-side structural reform. On the one hand, we will make efforts to support the expansion of domestic demand. Reasonable and ample liquidity will be maintained. Financial institutions will be guided to act in accordance with the market-oriented and law-based principle, and properly manage the scale and pace of granting credit. We will put forward measures in a timely manner so that they will produce effects early on. The prudent monetary policy will proactively coordinate with fiscal and social policies, providing greater support for enterprises to stabilize and expand employment and for key groups to start businesses and find jobs, and increasing the incomes of urban and rural residents in multiple channels. We will ensure strong support for the aggregate demand of society, but in a reasonable and appropriate way. A deluge of strong stimulus policies will be avoided. We will work to ensure the balance between stabilizing growth, employment and price. On the other hand, we will give better play to the guiding role of structural monetary policy instruments. We will continue to make better use of the carbon emission reduction facility and the central bank lending for sci-tech innovation and others. Support will be provided for accelerating the building of a modern industrial system. Preferential policies, such as the instrument supporting inclusive loans for micro and small businesses, will be better implemented. Strong support will be given to the construction of key infrastructure and major projects in areas such as energy, transportation and water conservancy. Financial services for rural revitalization will be enhanced. We will work to achieve a high level dynamic equilibrium between effective supply and demand.

Currently, as epidemic prevention and control measures have been optimized and economic circulation has returned to normal, the confidence of micro entities will be gradually restored and their vitality gradually unleashed. We will take more measures to boost market confidence and stimulate the vitality of micro entities. First, we will work to lower the overall financing costs for businesses, reduce costs for personal consumption, and alleviate the debt burden for micro entities to improve people's spending power and enterprises' investment capacity. Second, we will stay committed to unswervingly consolidating and developing the public sector and unswervingly encouraging, supporting and guiding the development of the non-public sector. We will guide financial institutions to strengthen and refine financial services, step up support for private micro and small enterprises in the manufacturing and service sectors, and further promote the instrument supporting debt financing of private enterprises. Third, we will encourage spending on housing, automobiles, and other big-ticket items, and strengthen comprehensive financial support for services consumption with a focus on key areas such as education, culture and sports. Fourth, we will maintain financing for the real estate sector in a steady and orderly manner. Guided by the principle that houses are for living in, not for speculation, we will adopt city-specific measures to implement a differentiated housing credit policy. We will make full use of policy instruments, including a special lending facility to ensure the delivery of pre-sold housing projects and loan programs to support pre-sold housing project delivery, to protect the legitimate rights and interests of homebuyers. We will carry out programs to improve the balance sheets of quality real estate enterprises and take effective measures to prevent and diffuse risks for quality leading real estate enterprises. We will improve financial policies to support rental properties and advance a smooth transition of the real estate sector to a new model of development. Thank you.

Zou Lan:

I would like to make a few more points for your reference. The structural monetary policy instruments that have been mentioned have attracted wide attention from all sectors of society. Over the past two years, the PBC has conscientiously implemented the decisions and plans of the CPC Central Committee and the State Council, giving full play to the role of the monetary policy in adjusting both the aggregate and structure. Structural monetary policy instruments have been frequently applied. Especially since last year, many monetary policy instruments have been introduced. Generally, structural monetary policy instruments focus on key sectors, adopt reasonable and moderate approaches, and build up ample room for maneuvering. As of the end of last year, the outstanding value of structural monetary policy instruments stood at about 6.4 trillion yuan. They have played an active role in guiding financial institutions to ensure appropriate credit supply, allocating more financial resources to key areas and weak links, keeping a steady growth in the aggregate monetary and credit supply, and stabilizing the economy's fundamentals.

China's structural monetary policy mainly focuses on key areas and weak links in the national economy, including inclusive finance, green development, and scientific and technological innovation. Specific structural monetary policy instruments are regularly released on the official website of the PBC. You can keep up to date on them. Recently, we have been working on introducing some other structural instruments. These instruments mainly provide support for ensuring stability in the real estate market, including loan programs to support pre-sold housing project delivery and rental properties. We will release more details after the introduction of these structural instruments. 

Shangyou News:

Statistics show that China's aggregate financing to the real economy (AFRE) in December rose slightly on a year-on-year basis. What factors influenced the AFRE at the end of the year? How do you evaluate the overall performance of the AFRE in 2022? Thank you.

Ruan Jianhong:

This reporter raised two questions. The first question is about the AFRE in December. The second one is about the AFRE in the whole year. First, I will answer the question about the AFRE in December.

In December 2022, the country's increment in the AFRE reached 1.31 trillion yuan, a year-on-year decrease of 1.05 trillion yuan. That was mainly due to a relatively large reduction in bond financing. On one hand, financing of government bonds stood at 280.9 billion yuan, a year-on-year decrease of 886.5 billion yuan. That was because government bonds were issued early this year. The financing of government bonds in the previous 11 months amounted to 6.84 trillion yuan, a year-on-year increase of about 1 trillion yuan. Financial support for the real economy was strengthened in advance. On the other hand, fluctuations in the bond market affected the financing of corporate bonds to some extent. The financing of corporate bonds saw a net decrease of 488.7 billion yuan in December, a year-on-year decrease of 705.4 billion yuan. Despite the slight increase of the AFRE this month, RMB loans issued by financial institutions to the real economy — an important constituent of the AFRE — increased by 1.44 trillion yuan, a year-on-year increase of 405.1 billion yuan. Credit support for the real economy continued to be enhanced.

Now let's take a look at the AFRE for the entire year. Overall, the AFRE in 2022 increased by 32.01 trillion yuan, 668.9 billion yuan more than 2021's increment. The financial system played a significant role in supporting the real economy. Let's look at the structural data.

First, financial institutions strengthened credit support for the real economy. In 2022, RMB loans issued by financial institutions to the real economy increased by 20.91 trillion yuan, 974.6 billion yuan more than 2021's increment. 

Second, the net financing of government bonds kept growing steadily. In 2022, the net financing of government bonds stood at 7.12 trillion yuan, and the increment was 107.4 billion yuan more than that of the same period of the previous year.

Third, off-balance-sheet financing saw a markedly narrower decline. Please note that it was a markedly narrower decline in off-balance-sheet financing. In 2022, entrusted loans increased by 357.9 billion yuan, 527.5 billion yuan more than 2021's increment. Trust loans decreased by 600.3 billion yuan, 1.41 trillion yuan less than 2021's decrement. Undiscounted bankers' acceptances reduced by 341.1 billion yuan, 150.5 billion yuan less than 2021's decrement.

In addition, the financing of corporate bonds saw a less increase. In 2022, the net financing of corporate bonds reached 2.05 trillion yuan, and the increase was 1.24 trillion yuan less than the same period of the previous year. Equity financing was 1.18 trillion yuan, roughly in line with that of the previous year.

Thank you.

Hong Kong Bauhinia Magazine:

How was credit growth in the real estate sector in 2022? In the recent meeting on credit work, it was proposed to improve the balance sheets of good-quality real estate developers. What new policies will be adopted to ensure the stable development of the real estate sector? Thank you.

Zou Lan:

Thank you for your questions. Positive circulation in the real estate sector is of great significance for the sound development of the economy. The Central Economic Work Conference has made clear that the steady development of the real estate market must be ensured; reasonable financing needs of the real estate sector should be met; effective measures should be taken to prevent and mitigate risks associated with leading real estate developers; different policies should be adopted in different cities as appropriate to their local conditions; people's justified housing need and the need to improve their housing situation should be supported; the principle that houses are for living in, not for speculation should be upheld; and the smooth transition of the real estate sector toward new development models should be advanced. In response to the adjustments in the real estate market, the PBC, together with relevant departments, has worked to improve both supply and demand in accordance with the arrangements of the CPC Central Committee and the State Council to promote stability in the real estate market. As relevant policies gradually produce effects, we notice that recently the financing environment in the real estate sector, especially for quality real estate developers, has been significantly improved. I would like to present two figures here. From September to November 2022, loans to real estate development increased by over 170 billion yuan, 200 billion yuan more than the increment of the same period of the previous year. In the fourth quarter of last year, bonds issued by real estate developers in China were worth over 120 billion yuan, a year-on-year increase of 22%. According to the specific arrangement made by the Central Economic Work Conference, the PBC and relevant departments recently proposed to improve the balance sheets of good-quality real estate developers. Earlier this year, the PBC and the China Banking and Insurance Regulatory Commission jointly held a symposium on credit work. That proposal was an important part of the symposium, which has also been released on the official website of the PBC. According to information publicly disclosed by developers, over the past decade, the balance sheets of the real estate sector in China have gone through rapid expansion. The assets of the top 50 real estate developers in China have grown by 10 times, with some growing by 23 times. Meanwhile, the liability structure of the real estate sector is highly diversified, among which financial liabilities only account for 31%, including 14% in development loans from banks, 9% in foreign and domestic bonds, and 8% in financing via non-standard credit assets. Others mainly consist of funding for projects in advance from upstream and downstream enterprises, making up 30%, the personal house payments collected in advance, accounting for 32%, and delayed tax payments and payments on land purchases, representing 7%.

To implement the arrangement made by the Central Economic Work Conference and prevent the spreading of risk from property developers with financial problems to good-quality ones, relevant departments have drafted an action plan to improve the balance sheets of good-quality real estate developers. Targeting quality property developers who focus on their core businesses and are characterized by compliant operation, good qualification, and of systematical importance, the action plan gives priority to advancing 21 tasks in four aspects, including activating assets, sustaining liabilities, replenishing equity, and improving expectations. By taking a holistic approach, the plan aims to improve the cash flows of high-quality developers and guide their balance sheets back to the safety zone. The tasks include both measures to ensure the implementation of the policies that have been issued and a series of new measures, such as setting up special re-lending for national asset management companies and loan programs supporting rental properties. There is no specific list of good-quality real estate developers in the plan, and financial institutions can make their own decisions.

Concerning the "three red lines" rules on real estate developers, the plan has specified that the rules targeting 30 pilot developers will be optimized. While the overall framework of the rules remains unchanged, some parameters will be improved.

That's all for my answers. Thank you.

Nikkei: 

From December 2022, the digital RMB was included in calculating the amount of currency in circulation (M0). What is the purpose of doing so? Is it related to its official issuance in the future? 

Xuan Changneng:

Thank you for your questions. The digital RMB is a digital version of the legal tender issued by the PBC. Like the physical yuan, the digital yuan is part of the currency. From the perspective of statistics and management, the physical and digital yuan should be tallied, analyzed and managed together. In recent years, as pilot schemes for digital RMB have advanced, application scenes have expanded and transaction volume and stock have increased. Relevant management and statistical systems have been improved. Adding the digital RMB to the calculation of money in circulation (M0) can provide a more accurate result of the latter. By the end of 2022, the amount of digital RMB in circulation was 13.61 billion yuan. With digital RMB included, the year-on-year increase in M0 was 15.3%. 

According to the requirement of steadily promoting the research and development of digital currency in the 14th Five-Year Plan, the PBC will advance research and development pilots of digital RMB in an orderly manner, continue to improve the top-level design and the construction of the ecosystem, and strengthen the innovation of products and applications. We will gradually establish a sound management framework and continue to build upon the pilot plan's success. Financial statistics will monitor the issuance of digital RMB in the future and release relevant data to the public on a timely basis.

Thank you. 

Tianmu News: 

The Central Economic Work Conference mentioned working unswervingly both to consolidate and develop the public sector and to encourage, support and guide the development of the non-public sector. This has created policy support and public opinion base that encourage the private economy and private enterprises to expand and strengthen. What measures will the PBC take to bolster the development of the private sector? Thank you.

Ma Jianyang:

Thank you for your question, which is of much concern to many people. In recent years, the Chinese economy has faced downward pressure due to the repeated impact of the pandemic and the unstable international situation, while private companies have faced more difficulties. According to the decisions and arrangements of the CPC Central Committee and the State Council, the PBC has created structural monetary policies, improved credit support policies, expanded diversified financing channels and continued to optimize the financing environment for private micro and small enterprises. Mr. Xuan presented statistics about inclusive loans to micro and small businesses in detail, and I will provide two more pieces of data. Inclusive loans to micro and small businesses have grown by around 20% for four straight years. In November 2022, the weighted average interest rate of newly issued inclusive loans to micro and small businesses was at 4.9%, a relatively low level. Micro and small businesses' effective needs for inclusive loans and their payment capacity were affected by the pandemic, and financial support has provided important guarantees and backing for them. For example, the market-based extension reached 30%. 

Going forward, earnestly implementing the arrangements of the Central Economic Work Conference and adhering to a problem-oriented approach, the PBC will focus on issues of concern to society and guide financial institutions to treat enterprises from all sectors on an equal footing. In doing so, we will create a better financial environment for the further development of the private economy and private enterprises. First, we will provide greater credit support for micro and small enterprises in the private sector. Mr. Zou explained the work to improve structural monetary policy tools, and we will continue to use these tools well with intensified efforts. Second, we will further increase the scale of debt financing by private enterprises. In November 2022, we improved and strengthened the work regarding private enterprises' debt financing, resulting in the total issuance of 16.9 billion yuan of debt by private enterprises in more than a month. Next, we will further optimize supportive mechanisms for private enterprises' debt financing and enlarge their scale of debt issuance. Third, financial services for private micro and small businesses will be further improved. Now many banks provide online services. Some of them are able to complete the transaction of loans of less than 1 million yuan in one minute, which will further improve the financing service for private companies. Fourth, we will continue to promote the healthy and regulated development of platform companies. Previously, progress was made in rectifying large platform companies' financial businesses and most problems were solved. Going forward, we will continue to urge platform companies to go through with the rectification work, and improve day-to-day supervision. We will also support platform companies in technological innovation for them to achieve fruitful results in driving development, creating jobs, and competing on the global stage. Thank you. 

Thecover.cn:

The Central Economic Work Conference proposed to ensure the stable development of the housing market; what measures will the PBC introduce? Some people believe that the housing market should be stabilized by cutting interest rates, especially mortgage rates. What is the PBC's view? Thank you.

Zou Lan:

I have already covered your first question in my previous answer. I'll focus on the second question about interest rates.

The policy of home loan rates will affect specific interest rates that are negotiated and confirmed between commercial banks and customers. Specific interest rates are directly related to monthly mortgage payments, so this is a very important policy. Last September, the PBC and the China Banking Regulatory Commission (CBRC) released a notice that clarified how governments of eligible cities could independently decide to temporarily relax the lower limit of interest rates for new first-home loans in the fourth quarter. After introducing this policy, some local governments actively made relevant adjustments, which led to a certain decrease in the interest rates of new home loans. According to the statistics we have, the national average interest rate for newly issued personal housing loans in December 2022 was 4.26%, down by 1.37 percentage points year on year, which is the lowest since the statistics began in 2008. The newly adjusted policy mainly aims to establish a dynamic mechanism for first-home mortgage rates. We have seen the policy show effect, and will, in accordance with the principle of "city-specific housing policies", allow cities to adjust the lower limit for the rate in phases based on changes in local home prices, so as to form a long-term mechanism to support a stable and healthy development of the housing market.

As for property prices, NBSC publishes year-on-year and month-on-month statistics of housing prices from 70 large and medium-sized cities on a monthly basis. Relevant local government departments have the statistics for the cities not included in these reports. After analyzing historical data for the 70 cities, it has been found that housing prices show clear periodic fluctuations. Three consecutive months of rise or decline could indicate a trend change in housing prices. It often takes quite a long time to form this trend change. According to the new policy, although local governments evaluate housing price changes in each quarter, it might take a longer cycle than the evaluation cycle to adjust the lower limit of the home loan rates when the trigger conditions are reached. That is to say, the home loan rate policy is dynamically adjusted according to housing price trends; at the same time, the policy also has strong stability. After the establishment of the dynamic mechanism, the new policy of first-home loan rates will be implemented through two-way, dynamic, and flexible adjustments under the city-specific housing policies. It will not only effectively support local governments that face greater difficulties in the housing market to make full use of the policy toolkit but also guide the governments of cities with rising housing prices to withdraw in a timely manner so as to promote the steady and healthy development of the local housing market. 

Thank you.

Yicai:

What have financial regulators done to promote the rectification of the platform economy in the past two years? What progress has been made so far? What is the policy direction for rectifying the platform economy, including financial technology regulation? Thank you. 

Ma Jianyang:

Thank you for your questions. I have just made a brief introduction about this; let me add something more. The PBC, China Banking and Insurance Regulatory Commission and China Securities Regulatory Commission, under the leadership of the CPC Central Committee and the State Council, have made solid efforts to rectify prominent problems in Ant Group and 13 other large platform enterprises since November 2020, according to the deployments of the Office of Financial Stability and Development Committee under the State Council. The problems included unlicensed businesses, regulatory arbitrage, unregulated expansion and behaviors that infringe on consumers' rights and interests. For more than a year, regulatory authorities, and especially those 14 platform enterprises, have taken active steps, demonstrated their understanding and achieved some positive results. Currently, most of the problems have been rectified. Large platform enterprises' awareness of rule-based business operation, fair competition and consumer protection has increased significantly, and their financial services have continuously improved. Meanwhile, financial authorities have tackled both symptoms and root causes and accelerated the development of the regulatory system. They introduced a series of targeted systems and documents in the fields of third-party payments, personal credit, internet deposits, insurance, securities and funds. The framework of a normalized supervision system of financial services of platform enterprises has taken shape, which has laid a sound institutional foundation for ongoing normalized supervision. 

Next, financial authorities will earnestly implement the principles of the 20th CPC National Congress and the Central Economic Work Conference, work unswervingly both to consolidate and develop the public sector and to encourage, support and guide the development of the non-public sector, place equal emphasis on development and regulations, and support the sound development of the platform economy. First, we will continue to speed up the rectification of a few unsettled problems of relative platform enterprises to complete the rectification work. Second, we will improve normalized supervision, regulatory systems and mechanisms. We will strengthen the regulatory capacity in science and technology, support platform enterprises to operate in accordance with rules and the law, and develop financial services in a steady and prudent fashion. We will show no tolerance for financial activities in violation of laws or regulations. Third, we will do research and formulate financial measures to promote the sound development of the platform economy. This will include supporting platform enterprises in improving their capacity for scientific and technological innovation, quality and service efficiency, thus consolidating and enhancing their international competitiveness. We will give full play to their abilities in spearheading development, creating job opportunities, and international competition. Thank you. 

CCTV:

What are the expectations and policies of the PBC in response to interest rate hikes by the U.S. Federal Reserve and its potential spillover effects? Additionally, given the grim situation in relation to foreign trade, will the RMB continue its trend of appreciation in the early part of the year? Thank you. 

Yi Changneng:

Since 2022, major developed economies, including the U.S., the eurozone and the U.K., have significantly tightened their monetary policies by aggressively raising interest rates. This has tightened the global financial system and caused emerging market economies to experience pressure from cross-border capital outflows. The market has certain expectations of interest rate hikes by the U.S. Federal Reserve in 2023. China has a big economy that is hugely resilient. In response to the COVID-19 pandemic, China has implemented normal monetary policies, instead of resorting to a deluge of strong stimulus policies, to maintain reasonably ample liquidity and ensure stable financial support for the real economy. China's financial system has shown great initiative and stability. Moreover, expectations of the RMB exchange rate are stable. All these are conducive to buffering and dealing with external risks, especially spillovers from interest rate hikes by developed economies. Generally speaking, developed economies' adjustments to monetary policies have a limited impact on China and may have a greater impact on other small emerging market economies. 

Next, the PBC will continue to adopt a comprehensive approach and react to developed economies' adjustments to monetary policies actively and prudently. We must make economic stability our top priority and focus on the domestic economic situation. We will ensure the proper intensity and pace of prudent monetary policies based on the domestic economic situation. In addition, we will increase the flexibility of the RMB exchange rate to enhance its function of adjusting the macroeconomy and international balance of payments. We will guide market entities to establish risk-neutral awareness, and strengthen unified, macroprudential management of cross-border capital flows. We will also strengthen expectation management and keep the RMB exchange rate generally stable at an adaptive, balanced level. In particular, we will guide enterprises to do a good job at hedging and establishing risk-neutral awareness.

Regarding the RMB exchange rate, the Chinese yuan has gradually appreciated against the U.S. dollar since mid-November 2022 as the economic stimulus policies started to take effect, and China's COVID-19 prevention and control measures have been optimized and financial measures to support the property sector have been introduced, as well as the market expected slower interest rate hikes from the Federal Reserve, and the dollar index retreated from its highs. The RMB's spot exchange rate against the U.S. dollar opened below 7.0 on Dec. 5.

The current and future trend of the RMB exchange rate could be affected by multiple factors, such as the domestic and international economic and financial situation, the country's balance of payments, market risk appetite and so on. It is inevitable that exchange rate forecasting in the short term is inaccurate. Overall, we have a solid foundation to maintain the basic stability of the RMB exchange rate. Recently, China's economic recovery has been on track with the nation constantly optimizing COVID-19 prevention measures. Moreover, China has basically maintained price stability in the face of high global inflation. The growth of China's trade surplus is likely to slow down, considering that the economic sentiment index of major economies has declined. The RMB exchange rate will remain basically stable under the influence of a variety of factors. Through years of financial reform and opening-up, China has greatly increased the depth and breadth of its foreign exchange market. The RMB exchange rate has become more flexible, market expectations have been kept stable, cross-border capital flows have been made orderly and the basic balance in international payments has been maintained. As a result, the RMB exchange rate will continue to remain basically stable at an adaptive and equilibrium level.

Thank you.

Shou Xiaoli:

Two more questions, please.

Xinhua News Agency:

Inflationary pressures in some countries have drawn much attention in the market. The central bank warned against future inflation risks in its report. Does the central bank think there will be inflation in our country in 2023? How will the central bank respond to the risk? Thank you.

Zou Lan:

It was indeed mentioned in the monetary policy report of the third quarter of 2022. We have also noted that discussions from all walks of life have been quite heated since the report was released. Mr. Xuan Changneng, vice governor of the PBC, also mentioned it just now. Last year, many countries around the world endured the highest inflation in decades. In stark contrast, China has kept price levels basically stable. Our achievements did not come easily. If we look back over the past five or 10 years, we can see that China's consumer prices have sustained an average annual growth rate of around 2%, which fully proves the strengths of our socialist system and the effectiveness of macro regulation. This also benefited from the resolute implementation of the decisions and plans of the CPC Central Committee and the State Council and coordinated efforts to ensure supply and price stability in key areas such as energy and food. At the same time, we have followed a prudent monetary policy and refrained from adopting a deluge of strong stimulus policies to foster a sound monetary and financial environment for price stability.

In 2023, China's inflation is expected to remain moderate, but we should also pay attention to the potential for an increase. On the one hand, China's inflation is expected to remain stable due to abundant supply and recovering demand, and we did not issue excessive currency. Currently, China's economy is still on a path of recovery, and the industrial and supply chains are operating smoothly. However, inadequate effective demand is still a prominent problem, and the output gap is still negative. In the short term, inflationary pressure is generally under control. In the medium and long term, as one of the world's major producers, China will continue to maintain a general balance between supply and demand, pursue a prudent monetary policy, and have stable inflation expectations. All these will provide favorable conditions to keep prices basically stable. On the other hand, there is still uncertainty about price levels, so we must not lower our guard against inflation. We must keep a close eye on the possibility of further inflation. Domestically, for some time, M2 growth rate in China has remained high, and the possibility of a lag in the impact on prices cannot be ruled out. As China optimizes its COVID-19 prevention and control measures, people's ability to consume will gradually improve, and aggregate demand will also increase, which is likely to put upward pressure on inflation. Internationally, geopolitical conflicts could disrupt global energy supplies and inflation could remain high throughout advanced economies, so we need to be wary of imported inflationary pressure.

In the next stage, the PBC will adhere to the general principle of seeking progress while ensuring stability, pursue the strategy of expanding domestic demand, and deepen supply-side structural reform, while prioritizing efforts to stabilize growth, employment, and prices. The bank's prudent monetary policy will be targeted and effective, eying short-term and long-term effects at the same time, balancing between economic growth and stability of prices, and pursuing both internal and external equilibrium. Furthermore, the bank will strengthen coordination among policies to promote the effective improvement of the economy's quality and reasonable growth.

ThePaper.cn:

At the end of December, M2 grew by 11.8% year on year, 2.8 percentage points higher than the same period in 2021. What is the reason for the high level of M2? What is your perspective on its future trend? Thank you.

Ruan Jianhong:

Thank you for your questions. According to published data, at the end of 2022, the M2 balance was 266.43 trillion yuan, a year-on-year increase of 11.8%. This rate is a 0.6 percentage point lower than the previous month (end of November 2022) and 2.8 percentage points higher than the same period of the previous year (end of 2021). The high growth rate of M2 is mainly due to the increased financial support of financial institutions for the real economy and the corresponding increase in derived currencies.

First, financial institutions significantly increased their bond investments. In 2022, bond investments by financial institutions increased by 6.92 trillion yuan, a year-on-year increase of 1.58 trillion yuan. Among these investments, government bond investments grew by 1.39 trillion yuan.

Second, various RMB loans rose steadily. In 2022, various RMB loans increased by 21.31 trillion yuan, a year-on-year increase of 1.36 trillion yuan.

Third, the equity and other investments of financial institutions increased significantly. In 2022, equity and other investments increased by 522.5 billion yuan, a year-on-year increase of 566.3 billion yuan.

At the same time, the central bank turned over profits of 1.13 trillion yuan, increasing the financial resources available to the government. After fiscal expenditures, the growth rate of M2 increased by around half a percentage point.

In 2023, the PBC will resolutely put into action the spirit of the 20th CPC National Congress and the Central Economic Work Conference, ensure its prudent monetary policy is targeted and powerful, and maintain credit support for the real economy. It is expected that the growth rate of M2 will remain stable and the reasonable ample liquidity will be maintained. Thank you.

Shou Xiaoli:

Thanks to all the speakers and friends from the media. Today's briefing is hereby concluded. Goodbye.

Translated and edited by Zhang Liying, Wang Qian, Xu Kailin, Wang Wei, Huang Shan, Liu Jianing, Liu Sitong, Yan Xiaoqing, Zhang Junmian, Yang Xi, Ma Yujia, Dong Qingpei, Li Huiru, Yan Bin, Daniel Xu, and Jay Birbeck. In case of any discrepancy between the English and Chinese texts, the Chinese version is deemed to prevail.

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Read in Chinese

Speakers:

Mr. Lian Weiliang, vice chairman of the National Development and Reform Commission (NDRC)

Mr. Zhang Jianhua, administrator of the National Energy Administration (NEA)

Mr. Zhang Zuqiang, deputy administrator of the China Meteorological Administration (CMA)

Chairperson: 

Shou Xiaoli, deputy director general of the Press Bureau of the State Council Information Office (SCIO) and spokesperson of the SCIO

Date: 

Jan. 13, 2023

Shou Xiaoli:

Ladies and gentlemen, good afternoon. Welcome to this press conference held by the State Council Information Office (SCIO). Today, we have invited Mr. Lian Weiliang, vice chairman of the National Development and Reform Commission (NDRC); Mr. Zhang Jianhua, administrator of the National Energy Administration (NEA); and Mr. Zhang Zuqiang, deputy administrator of the China Meteorological Administration (CMA), to brief you on ensuring energy supply and winter heating. They will also take your questions.

Now, I will give the floor to Mr. Lian Weiliang.

Lian Weiliang:

Ladies and gentlemen, friends from the media, good afternoon. I would like to thank our friends from the media and all the other sectors of society for your interest in and support for our work on ensuring energy supply. Today, Mr. Zhang Jianhua from the NEA, Mr. Zhang Zuqiang from the CMA, and I are here to brief you on ensuring energy supply and winter heating. Please first allow me to introduce the current situation.

Since last year, the global energy supply and demand situation has been grave and complicated, especially with supply shortages and drastic price fluctuations. As China's economy has been deeply integrated into the global economy, domestic energy supply was inevitably affected by changes in international energy supply and demand and price fluctuations. As a result, we faced mounting difficulties and pressure in ensuring domestic energy supply.

The Central Committee of the Communist Party of China (CPC) with Comrade Xi Jinping at its core attaches great importance to ensuring energy supply. The Central Economic Work Conference stressed strengthening regulation of supply and transportation of coal, electricity, petroleum, and gas to ensure a warm and safe winter for the people. The State Council has made specific deployments many times, calling on efforts to guarantee a stable economic performance, stable energy supply, and stable prices of electricity, gas, and other energy products for residents so that they can have a warm winter. This has been referred to as the “three guarantees.” The NDRC, the NEA, and other departments under the inter-ministerial coordination mechanism for ensuring supply and transportation of coal, electricity, petroleum, and gas have thoroughly implemented the guiding principles of the 20th CPC National Congress and the requirements of the CPC Central Committee and the State Council, and achieved initial success in ensuring winter heating and energy supply. Overall, the supply of energy has been guaranteed, and prices are stable across the country.

First, significant progress has been achieved in increasing energy production and supply. With safety as the premise, we have worked to ensure stable production and sufficient supply of coal, keeping daily coal production above 12 million metric tons in the heating season. We have fully tapped the potential for increasing petroleum and gas production, raising natural gas production by more than 10 billion cubic meters throughout the year. We have continued to improve power supply capacity, increasing the installed capacity of various types of power generation by more than 200 million kilowatts.

Second, energy reserve capacity and the capacity of ensuring energy supply during peak periods have been significantly enhanced. We have continued to enhance the natural gas reserve capacity. China's gas reserve capacity have exceeded 32 billion cubic meters. We have stored as much gas as possible before the winter, with 20 billion cubic meters available at present. The coal reserve capacity has been greatly improved. Our government-deployable coal reserve stands at about 50 million metric tons, while coal storage in power plants remains at a high level of about 175 million metric tons.

Third, the supply and price stability of energy products for people's livelihood have been effectively guaranteed. We have prepared resources for energy supply in advance. We have signed medium and long-term contracts with all the suppliers of coal for power generation and heating, and with the suppliers of gas for people's livelihood. Contract performance and transportation capacity have continued to improve. We have maintained mid- and long-term contract prices of thermal coal within a reasonable range, strictly implemented government pricing for household use electricity, and ensured that households under the coverage of the pipeline network consume natural gas at gate-station prices. In this way, we have guaranteed the sufficient supply and price stability of products for people's livelihood.

Fourth, the energy demand for economic and social development has been met. During the current heating season, the average national daily dispatched power generation capacity is 23.62 billion kWh, and the maximum daily power generation capacity is 25.5 billion kWh. The overall power supply and demand of the whole society has been balanced. The average national daily gas consumption is 1.15 billion cubic meters, and the maximum daily gas consumption is 1.3 billion cubic meters. All these have provided a strong support for economic and social development.

Thanks to the joint efforts of all parties, we have effectively responded to previous cold waves during this winter and maintained a stable and orderly energy supply nationwide. This was due to the strong leadership of the CPC Central Committee, which have proactively planned the building of energy production, supply, storage, and marketing systems in recent years to continuously improve China's energy supply capacity. We have also benefited from the strengths of the country's system , which creates synergy between an efficient market and a well-functioning government, and enable resolute actions to ensure energy supply for people's livelihood. Lastly, this success can also be attributed to our efforts based on China's realities to accelerate green and low-carbon energy transition, while making full use of coal and coal-fired power to avoid energy supply shortages. There are still more than two months until the end of the heating season, and more cold waves will arrive during the Spring Festival. Ensuring energy supply will continue to be a weighty task, and we must persevere in our efforts to deliver a solid performance in all areas of work.

First, we will continue to make efforts to increase energy production and supply. We will guide local governments and enterprises to well organize coal production during the Spring Festival holiday to ensure a stable supply. We will enhance electricity generation and supply capacity and keep domestic oil and gas fields operating safely at full capacity.

Second, we will strive to improve our capability to guarantee energy supply during peak periods. We will improve the comprehensive emergency distribution mechanism, featuring a complementary combination of coal, natural gas, and electricity. We will increase the output of thermal power generating units, improve hydropower distribution, and promote nuclear power, wind power, and photovoltaic power generation. Emphasis will be laid on response planning for power generation during peak periods and guaranteeing gas and coal resources used for power generation during peak periods.

Third, we will ensure energy supply in key regions. We will closely monitor heating companies' stockpiles in key regions, ratchet up railway transportation capacities, and carry out cross-provincial power distribution in a timely manner so as to ensure a safe and stable energy supply during key periods, including the Spring Festival.

Fourth, we will better organize resource imports. We will strive to stabilize the supply of imported natural gas and coordinate the management of underground gas storage facilities and LNG storage tanks to make sure that the gas supply for people's livelihoods will not be affected by fluctuating imports. Furthermore, we will secure coal imports to effectively supplement domestic supplies. 

Fifth, we will ensure people's basic energy needs are met. We will improve the electricity capacity management plan, enhance the emergency plan that prioritizes residential use of natural gas, and guide local governments to take joint actions with enterprises to activate the above-mentioned plans in an orderly manner. We will strengthen the monitoring of individual cases concerning heating and energy supply and quickly coordinate and handle problems to guarantee sufficient electricity and gas in order to meet people's living needs.

That's all for my introduction. Next, we would like to answer your questions. Thank you.

Shou Xiaoli:

Thank you for your introduction, Mr. Lian. Next, we'll move on to the question and answer session. Please identify the media outlet you represent before asking a question.

CCTV:

The world is facing tight energy supplies amid the current complex and grave international energy situation. Is a safe, stable, and steady energy supply guaranteed in China? Meanwhile, a new round of cold waves is about to hit the country as the Spring Festival approaches. What measures will be taken to guarantee a warm winter for the Chinese people? Thank you.

Lian Weiliang:

Thank you for your questions. Energy supply is of great concern to all of us. Since last year, facing a tight global energy supply and soaring prices, China has experienced increasing pressure to maintain its energy supply. Under the strong leadership of the CPC Central Committee and the State Council, China rolled out a series of effective response measures in an orderly manner. Clear progress has been made in stabilizing energy supplies and prices. As I introduced before, China's safe, stable, and steady energy supply is guaranteed, which can be demonstrated in five aspects: space for increasing production and supply, long-term agreements on resource imports, reserves of key energies, policies to stabilize prices, and mechanisms to ensure supplies in an emergency. 

First, there is space for China to increase its energy production and supply. Coal is our basic energy source. In recent years, our advanced coal production capacity has remarkably increased through measures of constructing large units, restricting small ones, increasing quality units, and cutting backward ones. Our power supply capacity has also been steadily enhanced, with the country's installed power generation capacity reaching 2.6 billion kW. Increases have been seen in oil and gas reserves and production. The production capacity of crude oil has exceeded 200 million metric tons annually, and that of natural gas is more than 220 billion cubic meters.

Second, we have signed long-term agreements on resource imports. People are concerned as to whether China's energy supplies, especially in crude oil and natural gas, which partly depend on imports, will be affected by fluctuations in the international market. I would like to take this opportunity to specify that spot goods are subject to being affected but that long-term agreements are relatively stable. We have followed international norms and market rules and secured imported resources through long-term agreements. For example, most of China's imported natural gas is secured through long-term agreements, which can effectively control and fend off risks of supply shortages and drastic price fluctuations.

Third, we have sufficient key energy reserves. We have substantially increased investment in reserve capacity building over the years. China's natural gas reserve capacity has exceeded 32 billion cubic meters. Natural gas has been stored as much as possible before the heating season. At present, halfway through the heating season, there are still 20 billion cubic meters of gas storage available. Moreover, there are about 50 million metric tons of coal that can be distributed by the government. As for coal stockpiles at power plants, the number remains at 175 million metric tons, fueling 22 days of heating, and can guarantee additional power generation during peak periods.

Fourth, we have launched policies to stabilize prices. Stable energy prices are crucial to people's well-being and stable economic performance. The pricing mechanism of coal has been further improved, enabling thermal coal prices to remain within the appropriate range. Steady progress has been made in reforms, making the pricing of on-grid electricity from coal-fired power plants increasingly market-based. The transmission mechanism of coal and electricity prices has been gradually improved. Government prices are strictly enforced in the arenas of residential electricity and gas so as to keep prices stable.

Fifth, we have set up a mechanism to ensure emergency supply. We have coordinated and let different types of energy, such as coal, natural gas, electricity, and petroleum products supplement each other so as to ensure their supply. The capability of ensuring energy supplies during peak usage has been steadily improved. The contingency plans for demand-side load management have been further improved. We will not limit the use of electricity or gas except in extreme scenarios. During extreme conditions, we will only limit the use of electricity and gas and not completely cut their supply in order to meet the basic demands for civilian energy use.

You just mentioned forthcoming cold fronts and the holiday energy supply. A cold front would increase heating energy demands. And if it brings rain, snow, and freezing weather, the production and transportation of coal will be affected as well as the power transmission. According to previous experience, general energy demands around Spring Festival are relatively lower, so supply can be guaranteed and the heating demands prompted by lower temperatures will be met. Even under extreme circumstances, when encountering unexpected civilian energy demands, we can act according to contingency plans and limit other energy usage to ensure civilian use is unaffected. Our energy supply is secure, and people will be able to enjoy sufficient heating in winter and have a happy Chinese New Year. 

We should take the new cold fronts seriously, maintain bottom-line thinking, and take active measures to respond to issues. The focus should be on ensuring production, transportation, peak-time operations, and quick responses to individual cases. 

First, to ensure production, we should guide energy enterprises to make contingency plans in the event of interruptions or a drop in production that may be caused by rain and snow. This is with the aim of maintaining production safely while making sure production does not drop or does not drop significantly. Second, to ensure transportation, we should guide power and heating plants and ports in the north to do a better job in unloading frozen coal and smooth the arteries and key links of coal transportation. Third, to ensure peak-time operations, we should enhance coordination, increase supply at peak times, and make sure additional civilian energy demands in extreme, low temperatures can be met. Fourth, to ensure quick response to individual cases, we should improve monitoring and pre-warning systems so as to identify potential risks before they grow into serious problems. All such issues should be tackled through coordination and in a timely manner. Thank you. 

Cover News:

As of last year, global energy prices have continued to remain high and unstable, especially in Europe, where prices of electricity and gas surged dramatically. Given that the energy supply of our country highly depends on imports, how will we maintain the basic stability of energy prices? Thank you. 

Lian Weiliang:

Thanks for your question. The stability of energy prices is relevant to people's livelihoods as well as the stable performance of the economy, and thus a public concern. We just said that the global energy demand and supply were complicated and not optimistic last year, with prices picking up sharply. Data shows that from January to November last year, energy prices, as part of the Consumer Price Index (CPI), went up 27% and 38% year on year in the United States and Eurozone, respectively, while natural gas prices increased 26.6% and 56.5% in the two regions and electricity prices 12.9% and 36.3%. In sharp contrast, China, also facing shockwaves from the global market and the test of extreme weather conditions, kept energy prices generally stable and within a reasonable range. This demonstrates the advantages of our system and the assorted measures for ensuring supply and stable prices. From January to November last year, the price of water, power, and fuel for civilian use, as part of CPI, only rose by approximately 3% in China, and the inflation in the price of gasoline and diesel was also lower than in Europe and the US. In particular, the prices of electricity and gas for civilian use were generally stable. 

China produces, consumes, and imports large amounts of energy. It is not easy to maintain a stable energy supply and prices while facing a grim external environment, especially with regard to stabilizing prices. The achievements of the past year are really something. The key to achieving them was to seriously implement the decisions and plans of the CPC Central Committee and the State Council; continue to improve the system of energy production, supply, storage, and marketing; and see stabilizing energy supply and prices as a systematic project and promote it through various measures. These efforts can be summarized as follows.

First, we focused on increasing effective supply. The increase of supply is the prerequisite for stable prices. So, we unleashed our advanced production capacities and improved energy production capabilities. We supported enterprises to go into full-capacity production while ensuring safety so as to increase effective supply. We also reinforced transportation coordination and links between production, transportation, and demands. 

Second, we focused on improving the pricing mechanism. A well-conceived pricing mechanism is the key to stabilizing prices. We innovated and improved a market-based pricing mechanism for coal and clarified the reasonable price range in the medium and long term. We deepened the reforms making the pricing of on-grid electricity from coal-fired power plants increasingly market-based and adjusted the price range of on-grid electricity from coal-fired power plants with rational means. We also insisted on ensuring people's livelihoods. Government pricing was strictly followed when it came to civilian electric power. Within the coverage of pipeline gas, civilian gas prices were fixed by combining ex-factory prices and pipeline transport prices. 

Third, we focused on making good use of medium- and long-term contracts. Signing medium- and long-term contracts is an important way to mitigate price fluctuations. We have encouraged domestic enterprises to sign long-term import agreements early and lock in import resources in advance. We have comprehensively improved the contract signing and implementation rate of long-term agreements. It can be said that medium- and long-term energy contracts have become the ballast to ensure supply and price stability.

Fourth, we have focused on the key role of energy companies in ensuring energy supply. Various energy companies have overcome difficulties and worked hard to increase production and supply. The government has tried its best to help energy companies tackle their difficulties, control costs through medium- and long-term contracts, rationally ease costs through the implementation of price policies, and increase fiscal, tax, and financial support to effectively alleviate the temporary difficulties in operation for some companies. This has created good conditions for ensuring energy supply and price stability.

Thank you.

Xinhua News Agency:

The new round of rainy and snowy weather this week will bring about a sharp drop in temperature. What is the overall situation of the current energy production and supply? Are we prepared for extreme weather? Thank you.

Zhang Jianhua:

Thank you for your questions. In accordance with the decisions and plans of the Party Central Committee and the State Council on ensuring energy supply and price stability, we have been working with relevant sides to make preparations, and going all out to do a good job to ensure that the supply of coal, electricity, oil, and gas can meet peak demand during winter.

In 2022, we kept on optimizing and adjusting the structure of the coal industry, actively expanded advanced coal production capacity, and phased out outdated production facilities. The elasticity of coal supply was significantly enhanced, and the annual average daily output remained at a reasonable level. Efforts were made to ensure the safe and stable supply of electricity. Over the year, coal-fired power generators with a total capacity of more than 30 million kilowatts were put into operation, and construction of generators with a total capacity of over 50 million kilowatts was started . The level of coal storage in the country's major power plants remained high. We fully promoted the increase of oil and gas reserves and production, which exceeded the phased goal set in a seven-year action plan for the oil and gas industry. Total crude oil production recovered to 200 million metric tons , and natural gas production exceeded 220 billion cubic meters, marking annual increases of more than 10 billion cubic meters for six consecutive years.

Since the beginning of the winter season, the energy supply has withstood the test of multiple rounds of cold waves. Since December last year, coal production has remained stable, and the electricity coal inventory has remained at about 175 million metric tons. The national electricity load has stabilized at about 1.1 billion kilowatts, with a maximum of 1.159 billion kilowatts, and power generation increased by 5.8% year-on-year. Since the beginning of this winter, the number of days when the daily supply of natural gas exceeded 1.2 billion cubic meters reached 38, and underground gas storage facilities operated at full daily capacity of above 170 million cubic meters to meet gas demand peaks for 20 consecutive days . At present, the consumption of coal, electricity, and natural gas across the country has dropped from the peak level, and the supply and demand situation has been generally stable and manageable. The energy supply in the current heating season has been guaranteed in terms of resource volume and regional balance. Governments at all levels and various energy companies have established emergency response mechanisms to ensure supplies. In order to further eliminate people's worries and smooth the channels for problem reporting and resolution, you can call the 12398 energy supervision hotline if the problem of heating services and supply by a specific energy company has not been resolved, or if the solution is not satisfactory after reporting. Thank you.

N Videos at Southern Metropolis Daily:

Recently, media reported that residents in areas where coal has been replaced with natural gas struggled with limited purchases and supply shortage. How do you view this problem? What measures should be taken to ensure residents' gas supply? Thank you.

Lian Weiniang:

Thank you for your questions. The CPC Central Committee and the State Council have attached great importance to the problem and required us to establish a special mechanism to monitor and solve the problem in a timely manner. After monitoring the problem you mentioned, we immediately mandated local governments to take measures to solve it. This has exposed the failure of some local governments and enterprises in implementing measures to ensure energy supply and stabilize prices for people's livelihoods. We will draw lessons from it, further consolidate the responsibility of ensuring energy supply in localities, and faithfully implement measures to ensure energy supply and stabilize prices for people's livelihoods. Hereby, I would like to emphasize that natural gas resources in the heating season are sufficient. The medium- and long-term natural gas contracts we signed before the heating season have exceeded the expected demand of various regions. Since the heating season began, actual consumption has been lower than expected. Overall, the total amount of natural gas is guaranteed. Therefore, no local governments or enterprises should limit the purchase of gas for people's livelihoods. Once such problems are found, relevant parties will be held accountable. If restrictions are due to insufficient gas supply contracts, the central government will coordinate relevant departments to increase supply; if they are due to other reasons, local governments will intervene to help on a case-by-case basis.

To prevent such problems from happening again, it is crucial to make sure that two parties shoulder their responsibilities. That is local governments should take responsibility for helping, supervising, and guaranteeing the supply and energy supply enterprises should take primary responsibility.

First, local governments should shoulder the responsibility for helping, supervising, and guaranteeing the supply. Local governments should provide more targeted assistance to enterprises supplying energy for people's livelihoods and help them solve specific difficulties through financial subsidies and other means if necessary. The reason why fuel enterprises in some urban areas have limited purchases and stopped the supply of natural gas, is objectively because, with the accelerated marketization of natural gas, the gas sources of those enterprises have become more diversified. Under the circumstance of a sharp rise in international natural gas prices, the cost of market-oriented gas purchases of some enterprises has grown rapidly. It is difficult to effectively handle these purchases in a short time, so phased operational difficulties are emerging. These problems must be addressed with due attention to both short- and long-range targets. Both symptoms and root causes should be addressed through deepening reform. At present, we will help enterprises on a case-by-case basis. Local governments should strengthen supervision over energy supply enterprises to ensure that they will effectively fulfill their responsibility to ensure supply. In extreme cases, where there is a risk of disruption to supply, local governments should make plans as soon as possible to guarantee supplies unconditionally. Before entering the heating season, the country has clearly required local governments to dispatch working groups to help enterprises involved in energy supply for people's livelihood, especially those in difficulty. We will urge local governments to earnestly implement these measures.

Second, enterprises should actively take responsibility for supplying energy. Enterprises engaged in energy supply for people's livelihood should strengthen their sense of social responsibilities, adhere to their mission of ensuring energy supply for the public good, and remain steadfast in ensuring energy supply and stabilizing prices. When difficulties arise, they should report to the authority instead of limiting purchases or cutting off supply.

Thank you.

Red Star News:

A set of nuclear energy heating projects, such as the demonstration nuclear heating project at the Hongyanhe nuclear power plant in Liaoning province, have been put into operation. How do those projects work? Will there be a further expansion to nuclear heating in the future? At the same time, how will you ensure the safety of these nuclear heating projects? Thank you.

Zhang Jianhua:

Thank you for your questions. Developing nuclear power in an active and orderly manner is a strategic plan made at the 20th National Congress of the CPC, which is a significant part of our energy strategy. It also plays an important role in optimizing our energy structure, ensuring energy security, building a new type of energy system, and helping to achieve carbon peak and carbon neutralization. At present, a total of 53 nuclear power units are in operation, with an installed capacity of 55.57 million kilowatts, accounting for nearly 5% of the total electric energy production. A total of 28 units with an installed capacity of 32.72 million kilowatts are under construction. Over the years, China's nuclear power units have maintained a good record in safety, with no operation incidents jeopardizing the environment and public safety. In addition, the main operation indicators have remained at an advanced international level.

Nuclear heating means extracting part of steam as a heat source while generating electricity in a nuclear power plant, carrying out a multi-level heat exchange system through heat exchange stations, and ultimately delivering this energy to residents through a municipal heating network. This is a safe and reliable concentrated heating method in urban areas since there are multiple shields to isolate nuclear power units from residents, transferring energy without the contact of mediums. NEA has attached great importance to nuclear heating. In 2019, the first-phase nuclear heating project at Haiyang nuclear power plant in Shandong province was put into operation. The plant was the country's first nuclear heating project and played an exemplary role. The second-phase project, with a heating area of 5 million square meters, has achieved full nuclear heating coverage in all urban areas of Haiyang city. In addition, Qinshan in Zhejiang province and Hongyanhe in Liaoning province have also since achieved nuclear heating. So far, these projects are running very safely and stably, bringing heating to the people. These projects have not only generated ecological and social benefits by replacing coal with nuclear energy, but also reduced local heating prices and improved economic benefits and people's livelihoods by advancing heating quality. It has formed an all-win situation. These projects have all gone down with local people.

At present, the follow-up projects of nuclear heating in Haiyang, Shandong province, and Qinshan, Zhejiang province, are under construction. Large-scale development of nuclear heating is taking shape, making it possible to provide heating over a further distance and a wider area. The NEA actively supports the further development of nuclear heating. Going forward, we will organize the work to summarize the experience of nuclear heating projects in operation, further promote its application under the premise of ensuring safety, and strive to make greater contributions to clean heating in China's northern region. Thank you.

China News Service:

What have been the climatic features of China since the beginning of winter? What challenges will these conditions bring to China's energy supply? What is your outlook for the weather during the Spring Festival? Thank you.

Zhang Zuqiang:

Thank you for your questions. Since the beginning of winter, China's climate has shown two prominent features. First, from the perspective of temperature, China has been 0.3 degrees colder on average compared to usual, but the temperatures have also fluctuated greatly. In December, the average temperature in China was 1.2 degrees lower than that in the same period on average. From Jan. 1 to yesterday (Jan. 12), the average temperature in China was 2.3 degrees higher than that in the same period on average, so the fluctuations in temperature have been relatively large. The second feature is that overall precipitation has been relatively small. According to our statistics, the national precipitation since the beginning of winter has been nearly 40% less than that of the same period on average.

The main impact on our energy supply is that cold air activity will bring low temperatures, rain, and snowy weather, which will affect energy supply in terms of both supply and demand. On the one hand, low temperatures brought by cold air activity will lead to an increase in residents' demand for heating; on the other hand, rain and snow may create some adverse effects on power supply facilities and raw materials, such as the transportation of coal to generate electric power. Therefore, from the perspective of supply and demand, there exist some pressures. The country's energy management and meteorological departments will maintain close communication and cooperation, respond in a timely manner, and take timely measures to minimize the adverse effects of the weather.

As for the weather during the Spring Festival, sunny to cloudy weather are expected to prevail in the north, while cloudy and rainy weather will prevail in the south. Generally speaking, based on current weather conditions, there will be three cold air events that will affect China. The first is the one that is affecting us now, that is, the large-scale nationwide rain and snowy weather from Jan. 11-15, which is expected to end on Jan. 15 or 16. The second cold air snap will occur between Jan. 19-20, which will affect northern China. The third cold air event will affect most of China's central and eastern regions around Jan. 23. Meteorological authorities will strengthen monitoring and forecasting and release relevant early warning information in a timely manner, making every effort to provide meteorological support services for the people in order to ensure a safe and peaceful Spring Festival.

Thank you.

Science and Technology Daily:

On the way to its carbon emissions peak and neutrality goals, China has seen its new energy sector including wind and solar power generation gain momentum. It has become an important part of the country's multi-energy supply system. What positive role has new energy played in safeguarding energy supply during winter? Thank you.

Zhang Jianhua:

Thank you for your question. In the past decade of the new era, under the scientific guidance of the new energy security strategy of "Four Reforms and One Cooperation" (namely, reforms in energy supply and consumption, market building and innovation, and comprehensive international cooperation) proposed by General Secretary Xi Jinping, China's new energy sector has made remarkable achievements. In 2022, the newly installed capacity of wind and photovoltaic power reached more than 120 million kW, and their cumulative installed capacity are expected to exceed 700 million kW, driving the installed capacity of renewable energy to top 1.2 billion kW. The wind and photovoltaic power industry has become one of the most competitive ones in the country.

With an increasing installed capacity, wind and photovoltaic power have been playing a significant role in safeguarding energy supply. First, wind and photovoltaic power have taken a bigger share in China's total newly installed capacity. According to statistics, in 2022, the newly installed capacity of wind and photovoltaic power accounted for 78% of the country's total newly installed capacity. Second, the country's newly added power generation capacity has been largely attributed to wind and photovoltaic power. In 2022, China's newly added wind and photovoltaic power generation capacity accounted for more than 55% of its total newly added. Third, the role of wind and photovoltaic power generation in ensuring supply is becoming more and more evident. According to power dispatching data from power grid companies, the average output of wind and photovoltaic power generation in most regions of the country accounted for about 15% of the average power load in 2022, or even 40% at its maximum. During the peak season in the summer of 2022, the average output coefficient of photovoltaic power reached 0.5 during the noon peak period in Jiangsu, Shandong, Zhejiang, and other provinces which have a larger installed capacity of photovoltaic power, providing strong support for the country's safe energy supply. Thank you.

ThePaper.cn: 

Recently, some heat suppliers said they were facing losses, and some even announced that they would stop supplying heat. It is known that heat suppliers are facing tremendous pressure in their business operations. Given this, what measures will be adopted? Thank you. 

Lian Weiliang:

Thank you for your question. We confirmed that the situation was true after an investigation. However, this is an individual case, and the problem has been addressed. Despite being an individual case, it reminds us that we need to make more efforts to investigate and identify risks and hidden problems in energy enterprises, in a bid to identify problems early and correct them while they are nascent. We will deal with every single problem that impacts energy and heat supply so as to keep people warm in the winter.

Some heat suppliers said that they are grappling with greater operating pressure due to surging costs in fuels. It is a problem that many enterprises have experienced, but we need to adopt proper and targeted approaches and methods in line with specific cases. We will make greater efforts in five aspects to ensure energy supplies. 

First, we will ensure the supply of resources. Regardless of their size or ownership, heat suppliers will all be involved in medium- and long-term coal contracts and strictly follow the contracts' pricing policies to control fuel costs appropriately. 

Second, we will ensure the full implementation of policies regarding pricing and subsidies. Local governments should deliver their promised subsidies promptly to alleviate the burden of heat suppliers hit by serious losses due to rising fuel costs. After the heating period, prices should be adjusted according to the law to manage the costs appropriately. The price adjustments regarding people's heating services should be strictly implemented via legal procedures.

Third, we will make sure that local governments take on the responsibility of ensuring energy supplies. If a heat supplier stops their supply, then local governments must take on the responsibility of ensuring heat supply unconditionally. 

Fourth, we will implement targeted measures to help enterprises. We will strictly implement a government responsibility system to assist and support heat suppliers. The working group sent by the government should take on responsibilities and make coordinated efforts to deal with the difficulties and problems encountered by enterprises in a timely manner. 

Fifth, we will implement the monitoring and fast-handling mechanism to deal with individual cases. While the total amount of heat supply can be ensured, it is crucial to prevent the emergence of various individual cases. We will thus give full play to the coordination mechanism to address individual cases in the supply of energy, as well as the hotline 12398 for complaints and reports on energy supervision across the nation, which has been mentioned by Mr. Zhang. By doing so, we will intensify public opinion monitoring and supervise the handling of individual cases in a bid to ensure that each case is assigned to the relevant department and addressed with feedback. Thank you. 

Shou Xiaoli:

Two last questions.

China Daily:

The global energy supply and demand situation has been grim and complicated since last year, leading to energy supply shortages and drastic price fluctuations. What measures has the NEA adopted to ensure domestic oil and gas markets remain stable? Thank you. 

Zhang Jianhua:

Thank you for your question. The Central Economic Work Conference in 2022 pointed out that major enterprises, especially State-owned enterprises, should take the lead in efforts to ensure supply and keep energy prices stable. The NDRC and the NEA have worked with departments, local governments, and enterprises to deal with the drastic fluctuations in the international energy market since the Russia-Ukraine conflict. We have made stepped-up efforts in the following aspects:

First, based on clear market expectations at the beginning of 2022, we have controlled the growth rate of natural gas consumption appropriately and regularly. By doing so, we have prevented large-scale imports of spot LNG products at high prices, while also avoiding the possibility of exacerbating the turmoil in the international market, contributing to our efforts to ensure a stable global market.

Second, we have made great efforts to discover more untapped reserves, and increase production, to ensure supply and maintain the stability of prices. In 2022, China's natural gas production increased by over 10 billion cubic meters, the sixth consecutive year the country has maintained such growth. As the import demand for natural gas is declining, the natural gas self-sufficiency rate, therefore, increased by almost 3 percentage points year on year.

Third, we have made greater efforts to build a new type of energy system with multiple energy sources complementing each other. Coal has been used as an emergency back-up source of power in industrial production or power generation during off-peak hours to reduce the use of natural gas. By doing so, we have ensured that natural gas is used to provide heat for residential homes during the heating season, which is our top priority. 

Fourth, we have ensured that centrally administered state-owned enterprises in the oil and gas sectors play a major role in maintaining stable supplies and prices. We have implemented a comprehensive pricing method for the “resources pool” of oil and gas products, which considers prices of domestically produced products, those of the long-term import contracts, and a small amount of the imported spot products. In this way, we have been able to ensure stable prices. 

Fifth, we have formulated lists of projects every year since we start to build our energy production, supply, storage and marketing systems. As such, greater efforts have been made to improve our oil and gas pipeline networks and gas storage facilities, with an average annual increase of 100 million cubic meters per day in our supply capacity over the past five years. We have overcome the bottleneck in oil and gas infrastructure capacity since the heating season in 2021. The infrastructure is capable enough to ensure abundant energy supplies during this year's heating season, thus ensuring supplies in terms of total amount and demand during peak hours as long as there are enough resources. Thank you. 

Economic Daily:

It is widely believed that energy enterprises that sign and honor medium- and long-term energy contracts play a crucial role in keeping stability in energy supplies. However, according to some enterprises, the medium- and long-term energy contracts they signed were not able to fully cover their demands, and some of these contracts could not be fulfilled. What will be done to further promote the signing and honoring of the medium- and long-term energy contracts? Thank you.

Lian Weiliang:

Thank you for your question. As has been mentioned, medium- and long-term energy contracts have served as both a ballast and an anchor for keeping energy supplies and prices stable. It is also an important institutional innovation based on China's national conditions to ensure stability in energy supplies and prices. Medium- and long-term contracts are of great significance for stabilizing supply and demand-side expectations, locking resources, controlling costs, and ensuring supplies. Just now, you mentioned some specific cases. After an in-depth investigation, we found that behind these cases exist, to varying degrees, the problem that enterprises did not sign medium- and long-term contracts or the contracts they signed did not fully cover their demands. Therefore, the role of medium- and long-term energy contracts should be given better play to ensure energy supplies. The problem of fulfilling contracts, as you mentioned, still exists. This year, we will take stronger measures to help solve these problems. To be specific, we will ensure that all contracts that should be signed will be signed and that enterprises will be punished for the breach of contracts.

First, we will ensure that all contracts concerned will be signed. In some medium- and long-term energy contracts, whether to include some contents in the contracts is utterly decided by market entities through their negotiations. However, concerning the contents that relate to public interests, people's livelihoods, and ensuring energy supplies, enterprises should officially sign medium- and long-term contracts under the guidance of the government in a well-regulated way. For example, we have made it clear that when it comes to coal for electricity power generation and heating supplies and gas supplies for household use, medium- and long-term contracts should be signed in a well-regulated way under the guidance of the government. It should also be ensured that all contracts concerned are signed. The goal we put forward in this regard is full coverage of 100%. At present, some small-scale heating and gas supply enterprises lack enough knowledge of the medium- and long-term contract system and fail to make full use of it. Some enterprises exist in special stages and are unwilling to sign medium- and long-term contracts. In response to that, we will guide various functional departments at all levels within the government to make greater efforts to publicize and explain the system to enterprises. Some enterprises have stated that they can't get medium- and long-term contracts. Coordination mechanisms to ensure the supply of coal, electricity, oil, gas, and transportation services at all levels will therefore work to solve the problems enterprises encounter when signing these contracts.

Second, we will ensure that enterprises will be punished for the breach of contracts. A credit system is the base of a market economy. Honoring contracts in good faith is the fundamental responsibility of enterprises. While signing contracts is important, fulfilling contracts is more important. Now, as there is a certain gap between prices in the medium- and long-term contracts and those in the market, there are some cases where some enterprises do not perform well in honoring contracts. The government will therefore tighten regulation of all medium- and long-term energy contracts. As of last year, over 300 complaints have been received regarding enterprises failing to follow or fulfill contracts. We have promoted relevant enterprises to rectify their problems, and most of these problems have been corrected. Concerning medium- and long-term contracts designed to ensure energy supplies, especially in contracts relating to coal for electricity power generation and heating supply, a punishment and constraint mechanism has been established to require enterprises that fail to fulfill their contracts offer three times the quantity and the price of resources as prescribed in the contracts. There are five cases where enterprises have failed to abide by their contracts. Since these enterprises refused to rectify their problems, we have taken measures to punish them in accordance with the punishment and constraint mechanism. We have also put these enterprises on a list of severely dishonest enterprises and will continue to monitor their credit. For government-led medium- and long-term energy contracts, especially contracts concerning people's livelihoods, we will ensure that all contracts concerned are signed and fully implemented. We welcome friends from the media and all sectors of society to strengthen oversight and report clues to us about enterprises that fail to abide by contracts, and we will strictly urge them to fully rectify their problems.

Thank you.

Shou Xiaoli:

Thank you to all the speakers and to the friends from the media for your presence. Later we will hold the next press conference. You are welcome to join us then.

Translated and edited by Zhang Liying, Wang Qian, Huang Shan, Zhou Jing, Liu Stiong, Yan Bin, Zhang Junmian, Qin Qi, He Shan, Zhang Rui, Wang Wei, Gong Yingchun, Ma Yujia, Xu Kailin, Li Huiru, David Ball, Daniel Xu, Tom Arnsten, and Jay Birbeck. In case of any discrepancy between the English and Chinese texts, the Chinese version is deemed to prevail.

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Read in Chinese

Speaker:

Lyu Daliang, spokesperson of the General Administration of Customs of the People's Republic of China (GACC)

Chairperson:

Xing Huina, deputy director general of the Press Bureau of the State Council Information Office (SCIO) and SCIO spokesperson

Date:

Jan. 13, 2023

Xing Huina:

Ladies and gentlemen, good morning. Welcome to this press conference held by the State Council Information Office (SCIO). Today, we are joined by Mr. Lyu Daliang, spokesperson of the General Administration of Customs of the People's Republic of China (GACC), who will introduce the situation and answer your questions.

Now, I'll give the floor to Mr. Lyu for a brief introduction.

Lyu Daliang:

Ladies and gentlemen, friends from the media, good morning! Welcome to today's press conference. It's a great pleasure to meet you. I'll begin by introducing China's import and export performance for 2022 and then answer your questions.

In 2022, under the strong leadership of the Communist Party of China (CPC) Central Committee with Comrade Xi Jinping at its core, China kept in mind both our internal and international imperatives and coordinated epidemic response with economic and social development, as well as balancing development and security, amid complex and severe domestic and international situations. Despite facing unexpected challenges, China's volume of foreign trade and imports reached new heights, with a steady improvement in their quality. According to statistics from the GACC, China's foreign trade value in 2022 was 42.07 trillion yuan, up 7.7% year on year. Exports saw a 10.5% increase to 23.97 trillion yuan, and imports rose by 4.3% to 18.1 trillion yuan. Specifically, there were five main features, which I will now outline:

First, China's imports and exports are resilient and large in scale. China's foreign trade value exceeded 40 trillion yuan for the first time in 2022, continuing to grow from the high base set in 2021 and reaching a new record high. China has been the world's largest trading nation for goods for six consecutive years. In the first and second quarters of 2022, the total value of imports and exports surpassed 9 trillion yuan and 10 trillion yuan, respectively. In the third quarter, the total value of imports and exports increased to 11.3 trillion yuan, a new quarterly record. In the fourth quarter, the total value of imports and exports remained at 11 trillion yuan.

Second, China's trading partners are well-distributed and have strong growth potential. In 2022, China's imports and exports with ASEAN, the European Union, and the United States reached 6.52 trillion yuan, 5.65 trillion yuan, and 5.05 trillion yuan, respectively, an increase of 15%, 5.6%, and 3.7%, respectively. During the same period, China's trade with countries along the Belt and Road increased by 19.4%, accounting for 32.9% of China's total foreign trade, up 3.2 percentage points. The country's trade with other members of the Regional Comprehensive Economic Partnership (RCEP) increased by 7.5%.

Third, general trade is growing rapidly and its share is increasing. In 2022, China's general trade reached 26.81 trillion yuan, an increase of 11.5%. It accounted for 63.7% of the total foreign trade volume, up 2.2 percentage points. Among general trade, exports rose by 15.4% to 15.25 trillion yuan and imports expanded by 6.7% to 11.56 trillion yuan. During the same period, processing trade reached 8.45 trillion yuan, accounting for 20.1% of the total foreign trade volume.

Fourth, the number of foreign trade entities is increasing and they have strong vitality. In 2022, the number of enterprises involved in exports and imports increased by 5.6% to 598,000. Among them, there were 510,000 private enterprises, an increase of 7%. Their imports and exports reached 21.4 trillion yuan, up by 12.9%, accounting for 50.9% of the total foreign trade volume, up by 2.3 percentage points. Meanwhile, foreign-invested enterprises and state-owned enterprises recorded 13.82 trillion yuan and 6.77 trillion yuan in foreign trade, respectively, accounting for 32.9% and 16.1% of the total foreign trade volume.

Fifth, the main products enjoyed stable supply and demand as well as abundant advantages. In 2022, China's imports and exports of electromechanical products reached 20.66 trillion yuan, up by 2.5% and accounting for 49.1% of the total import and export value. Specifically, exports of solar cells, lithium batteries, and automobiles increased by 67.8%, 86.7%, and 82.2%, respectively. In the same period, the export of labor-intensive products amounted to 4.28 trillion yuan, up by 8.9% and accounting for 17.9% of the total export value. Specifically, exports of bags and suitcases, shoes, and toys rose by 32.6%, 24.4%, and 9.1%, respectively. In addition, imports of energy products such as crude oil, natural gas, and coal totaled 3.19 trillion yuan, up by 40.9% and accounting for 17.6% of the total import value. The import of agricultural products reached 1.57 trillion yuan, up by 10.8 % and accounting for 8.7% of the total import value.

2022 was an essential year in the history of the Party and the country. The 20th CPC National Congress was successfully convened, drawing an ambitious blueprint for building a modern socialist country in all respects. Despite the triple pressures of demand contraction, supply shock, and weakening expectations, as well as many great challenges and difficulties, China still made outstanding achievements in foreign trade, which speaks volumes of its resilience. This is the result of the strong leadership of the CPC Central Committee with Comrade Xi Jinping at its core. Over the past year, with a focus on welcoming the 20th CPC National Congress, as well as studying, publicizing and implementing its guiding principles, customs authorities have developed a deep understanding of the decisive significance of establishing Comrade Xi Jinping's core position on the Party Central Committee and in the Party as a whole and establishing the guiding role of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, resolutely upheld Comrade Xi Jinping's core position on the Party Central Committee and in the Party as a whole and upholding the Party Central Committee's authority and its centralized, unified leadership, and unwaveringly implemented the decisions and deployment of the CPC Central Committee and the State Council. In accordance with the important requirements of preventing the epidemic, stabilizing the economy, and securing development, we have guarded the country's door and promoted the development and efficiently coordinated epidemic prevention and control at ports and the promotion of the steady growth of foreign trade, which has effectively facilitated the stable and quality development of foreign trade and made positive contributions to steady and sound economic growth.

In general, China's foreign trade secured new breakthroughs in 2022, and the scale, quality, and performance of imports and exports improved simultaneously. These achievements did not come easily. Looking ahead to this year, China's foreign trade development will still face many difficulties and challenges as the foundation for our economic recovery is still not solid, the external environment is turbulent, and the downward pressure on the global economy is mounting. While facing these difficulties and challenges, we must also recognize that China's economy enjoys strong resilience, tremendous potential, and great vitality and that the fundamentals sustaining its long-term growth have remained strong. Overall, our economy is expected to pick up this year, and we must be more confident in stabilizing the scale and optimizing the structure of foreign trade.

2023 is the first year when the guiding principles of the 20th CPC National Congress are implemented. The GACC is convening the national customs work conference today to study and deploy the work for 2023. Customs authorities will follow the guidance of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, thoroughly grasp the decisive significance of the establishment of both Comrade Xi Jinping's core position on the Party Central Committee and in the Party as a whole and the guiding role of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, and resolutely uphold Comrade Xi Jinping's core position on the Party Central Committee and in the Party as a whole, and uphold the Party Central Committee's authority and its centralized, unified leadership. We will earnestly study and implement the guiding principles of the 20th CPC National Congress, effectively implement the major decisions and arrangements of the CPC Central Committee and the State Council, and cement loyalty, carry out missions, guard the door of the country, promote development, and work hard in solidarity. We will keep our feet on the ground and forge ahead, make greater efforts to stabilize the scale and optimize the structure of foreign trade, speed up the construction of modern socialist customs, and make new and greater contributions to promoting a Chinese path to modernization on all fronts.

Now, I would like to take your questions.

Xing Huina:

Thanks, Mr. Lyu, for your introduction. Now we will open the floor for questions. Please identify the media outlet you represent before raising questions.

Phoenix TV:

Last year, China maintained steady growth in foreign trade. What are the main driving factors? What are your expectations for foreign trade this year? Thank you.

Lyu Daliang:

Thank you for your questions. In 2022, facing the challenges of multiple factors that exceeded expectations, China's foreign trade achieved steady growth based on a high base number in 2021. Its annual volume topped 40 trillion yuan (about 5.94 trillion U.S. dollars) in 2022 for the first time, which made positive contributions to stable and sound economic development. In our view, the main factors driving the growth are as follows:

First, export markets expanded, and major products maintained sufficient competitive advantages. From a market perspective, in 2022, China's export to the ASEAN, the EU, and other major trading partners maintained rapid growth. Thanks to the accelerated expansion of emerging markets, China's export to countries along the Belt and Road rose by 20%, driving overall export growth by 6.1 percentage points. Exports to Africa and Latin America increased by 14.8% and 14.1%, respectively. From a product perspective, China's exports of industrial products increased by 9.9% in 2022, driving overall export growth by 9.4 percentage points. Exports of labor-intensive products maintained rapid growth, and the export growth rate of green and low-carbon products, such as solar cells, lithium batteries, and electric vehicles, surpassed 60%. New drivers of export growth increased rapidly. According to the latest data, China's share of global exports is estimated to reach 14.7%, topping the world for 14 consecutive years.

Second, imports were underpinned by the huge domestic demand. In 2022, the country took into account both domestic and international dynamics, coordinated COVID response with economic and social developments, and balanced development and security. As a result, China's economy saw steady and sound development, with its major economic indicators, such as value-added of industrial enterprises above the designated size and fixed-asset investment, rising continuously, which provided strong support for import growth. In 2022, exports of intermediate goods increased by 7.5%, driving overall import growth by 5.9 percentage points. In addition, high global commodity prices also contributed to the growth of import values to some extent.

Third, supportive policies injected a strong internal impetus for foreign trade development. In 2022, the Chinese government carried out a package of policies and follow-up measures to stabilize the economy. In the field of foreign trade, they included ensuring access to foreign trade, increasing fiscal, tax, and financial support, encouraging new forms of foreign trade, supporting foreign trade enterprises in securing orders and expanding markets, and improving trade security and facilitation. As the efficacy of these policies and measures continues to be unleashed, the vitality of China's foreign trade entities has been stimulated. In 2022, the number of enterprises involved in imports and exports increased by 5.6% compared with the previous year. The three major foreign trade entities -- private, foreign-invested, and state-owned enterprises -- gave full play to their respective advantages, and their import and export operations remained sound.

As for the trend of foreign trade, I have mentioned that we still face many difficulties and challenges. At the same time, our economy is expected to realize an overall recovery this year, and foreign trade development will enjoy many favorable conditions, so maintaining the scale and optimizing the structure of foreign trade have a solid basis. Thank you. 

National Business Daily: 

We've noted that the share of private enterprises in foreign trade surpassed 50% last year for the first time. Could you please provide a brief on that? Thank you. 

Lyu Daliang: 

Thank you for your question. The CPC Central Committee and the State Council have always attached great importance to private enterprises and the private sector. Last year, a package of policies and sustainable measures was issued to stabilize the economy, and then the vitality of various market entities, including private enterprises, was unlocked. According to customs statistics, the number of private enterprises recording import and export performance reached 510,000, with their foreign trade volume totaling 21.4 trillion yuan, up by 12.9%. There are several highlights, as follows: 

First, their proportion in foreign trade improved, and private enterprises played a remarkable role in stabilizing foreign trade. The principal position of private enterprises in foreign trade has been consolidated and they have continuously served as a stabilizer. In 2022, the share of private enterprises in the scale of imports and exports reached 50.9%, up by 2.3 percentage points year on year. It's the first time that their annual proportion exceeded 50%. The contribution rate of private enterprises to China's foreign trade growth reached 80.8%.

Second, ties with traditional partners maintained advantages, and emerging markets were vigorously explored. In 2022, the imports and exports of private enterprises to ASEAN, EU, and US, China's top three trade partners, all maintained doubt-digit growth rates, which were 27.6%, 12.6%, and 10.6%, respectively, accounting for 43.9% of private enterprises' total import and export volume. At the same time, the imports and exports of private enterprises to other BRICS countries, Latin America, and the five Central Asian countries grew by 22.1%, 14.5%, and 55.1%, respectively.

Third, the export of mechanical and electrical products and the import of agricultural products grew rapidly. As for exports, in 2022, the export volume of mechanical and electrical products by private enterprises totaled seven trillion yuan, up by 15.3% year on year. Among them, the growth rates of electronic components, electrical appliances, and auto parts reached 22%, 42.5%, and 19%, respectively. As for imports, in 2022, private enterprises imported agricultural products totaling 862.06 billion yuan, up by 14.9% year on year. The growth rates of imported bronze; medicines and medical and medicinal materials; and basic organic chemicals grew by 25.3%, 15.3%, and 8.7%, respectively.

Fourth, private enterprises in central and western regions became more vitalized. In 2022, the import and export of private enterprises in central and western regions grew by 21.5% and 21.2%, respectively, accounting for 20.1% of the total import and export volume of private enterprises, which was 1.4 percentage points higher than that of the previous year. 

CCTV:

Pilot free trade zones and free trade ports are at the forefront of China's opening-up. What work did the customs authorities do last year to promote the development of pilot free trade zones and the Hainan Free Trade Port? Thanks!

Lyu Daliang:

Thank you for your question. The construction of free trade zones and free trade ports is a major policy and plan of the CPC Central Committee and the State Council. In accordance with the CPC Central Committee's requirements on "implementing the strategy to upgrade pilot free trade areas" and "accelerating the Hainan Free Trade Port development ," the customs authorities will continue to deepen reform and promote innovation, accelerate the exploration of institutional opening measures such as rules, regulations, management, and standards, and actively support the development of pilot free trade zones and the Hainan Free Trade Port.  

In terms of supporting the development of pilot free trade zones, the customs authorities insists on institutional innovation as the core, upholds replicability and promotion as the basic requirements, and actively carries out the innovation of the customs supervision system in pilot free trade zones. In 2022, local customs authorities filed 33 innovations in customs supervision to the GACC, including a management mode on tracing to the source of Hainan 's offshore duty-free commodities. The GACC reviewed 53 innovative measures previously filed. It formed two innovative systems, including the "enterprise and group processing trade bonded supervision mode" and "international voyage ship transfer data reuse mode,” and replicated and promoted them across the country. Customs statistics show that in 2022, the total import and export value of China's pilot free trade zones was 7.5 trillion yuan, an increase of 14.5%. Among them, the export value was 3.3 trillion yuan, an increase of 18.1%, and the import value was 4.2 trillion yuan, an increase of 11.8%.

In terms of supporting the construction of the Hainan Free Trade Port, the customs authorities insist that “opening-up” can be achieved by way of “management.” We have drafted the “Regulations of the People's Republic of China on the Supervision of the Hainan Free Trade Port ,” and continuously promoted the implementation of early harvest policies such as “zero tariffs" to deliver results. We have accelerated the expansion of the pilot project of the "first-line release, second-line control" import and export policy system, approving and issuing a list of pilot enterprises. We have formed a "Key Work List" for the entire island's customs closed-up operation, and worked out timetables and wall chart operations to prepare for a comprehensive stress test. In the past two years, the import and export of goods at the Hainan Free Trade Port have developed rapidly. After exceeding 100 billion yuan for the first time in 2021, it reached a new level in 2022, breaking through the 200 billion yuan mark for the first time, reaching 200.95 billion yuan, an increase of 36.8%. Among them, the export value was 72.26 billion yuan, an increase of 120.7%, and the import value was 128.69 billion yuan, an increase of 12.8%. Thank you.

Tianmu News:

We have noticed that China is now managing COVID-19 with measures against Class B infectious diseases and it is no longer included in the management of quarantine infectious diseases. What work have the customs authorities done regarding epidemic prevention and control at ports and stations? Thank you!

Lyu Daliang:

Thank you for your question. Since the emergence of COVID-19, China Customs has fully implemented the decisions and plans of the CPC Central Committee and the State Council, preventing infections and imported cases at ports. We have carried out strict health and quarantine measures for inbound travelers and public transportation. Science-based and targeted measures have been taken to prevent infections of personnel, goods and the environment, to prevent the import of multiple diseases, and to prevent infections via land, sea and air transportation, making contributions to the country's fight against COVID-19.

After China started managing COVID-19 with measures designed for combating category B infectious diseases an d no longer placed COVID-19 under quarantinable infectious disease management , in accordance with the plans of the State Council inter-agency task force and the Frontier Health and Quarantine Law of the People's Republic of China and its detailed regulations, China Customs has carried out relevant work in a steady, orderly and science-based manner.

First, we improved health and quarantine measures at ports for inbound travelers. Following the requirements of the State Council inter-agency task force, we no longer conduct nucleic acid tests on all inbound travelers. Inbound travelers' nucleic acid tests within 48 hours before departure have been included in the customs health status declaration. We have implemented regular health and quarantine measures, including conducting checks on health declaration cards, temperature screening, medical screening and epidemiological investigation. At the same time, we have adopted differentiated response measures based on the results shown on the health declaration cards.

Second, we improved quarantine measures for imported goods. Imported cold chain food will no longer undergo random nucleic acid testing and preventive disinfection measures. Meanwhile, we will continue to apply the strictest possible standards, oversight, punishment, and accountability to ensure food safety. We will maintain contact with the relevant departments of export countries and regions, and urge them to follow the guidelines put forward by the Food and Agriculture Organization of the United Nations on preventing infections. As for non-cold chain products, there will no longer be risk assessments for COVID-19 infections and preventive disinfection measures. Since China started managing COVID-19 with measures designed for combating category B infectious diseases and no longer placed COVID-19 under quarantinable infectious disease management on Jan. 8, customs clearance has been carried out in a smooth and orderly fashion. Thank you.

CNBC:

Question about the development of cross-border e-commerce in 2022. Are there any countries or regions that have purchased goods from China? What are these goods? What are the prospects for cross-border e-commerce this year?

Lyu Daliang: 

Thank you for your questions. First, I will outline the data on cross-border e-commerce. According to preliminary calculations, in 2022, China's cross-border e-commerce imports and exports totaled 2.11 trillion yuan, an increase of 9.8%, with exports and imports increasing by 11.7% and 4.9% to 1.55 trillion yuan and 0.56 trillion yuan, respectively. In recent years, cross-border e-commerce has witnessed rapid development. China has introduced a series of relevant supporting policies to further unleash potential and give full play to the advantages of cross-border e-commerce. Thank you.

China News Service:

We have noticed that ASEAN has remained China's largest foreign trade partner for three consecutive years. Last year, the total value of imports and exports between China and ASEAN grew by 15%. What are the reasons behind the rapid growth in trade between China and ASEAN? How do the customs authorities view the situation? Thank you.

Lyu Daliang:

Thank you for your questions. The bilateral economic and trade exchanges between China and ASEAN have become closer since the two parties established a comprehensive strategic partnership in 2022. Last year, the total volume of imports and exports between China and ASEAN reached 6.52 trillion yuan, an increase of 15%. The volume of exports reached 3.79 trillion yuan, an increase of 21.7%, and the volume of imports reached 2.73 trillion yuan, an increase of 6.8%. During this period, ASEAN saw its proportion in China's foreign trade increase by 1 percentage point from 2021 to 15.5%, maintaining its position as China's largest trade partner.

Specifically, the factors contributing to the rapid growth in trade between China and ASEAN can mainly be attributed to the following aspects.

First, the effective implementation of RCEP has brought trade-creation effects and facilitated cooperation among industrial chains. Over the past year since the implementation of RCEP, the policy dividends have continued to be unleashed, contributing to closer economic and trade exchanges among countries in the region. ASEAN is an important trade partner of China in RCEP. In 2022, China's imports and exports with ASEAN accounted for 50.3% of its total imports and exports with other RCEP members. China's imports and exports of intermediate products with ASEAN increased 16.2% to 4.36 trillion yuan, accounting for 67% of China's total imports and exports with ASEAN.

Second, the ever-improving interconnectivity has facilitated economic and trade exchanges. With the solid progress of the construction of the new western land-sea corridor, the passage of goods in and out of China and ASEAN has become more convenient. Various modes of transportation have developed in a coordinated way, with railway transportation showing significant growth. In 2022, China's imports and exports with ASEAN by rail, water and air increased by 197.6%, 26.7% and 15.5%, respectively. The opening of the China-Laos Railway at the end of 2021 has provided new impetus to further deepen economic and trade cooperation between China and relevant countries. In 2022, among the goods transported by rail between China and ASEAN, 44.7% were through the China-Laos Railway, contributing more than 60% to the growth of imports and exports by rail between China and ASEAN.

Third, cooperation on agricultural goods has deepened, leading to an expansion in imports. In recent years, China has accelerated the pace of importing agricultural products from ASEAN members and continued to optimize quarantine access procedures for agricultural products and other key products. Various agricultural products, such as fresh durians from Vietnam, longans from Cambodia, and passion fruits from Laos, have gained new quarantine access in China. In 2022, the total value of agricultural products China imported from ASEAN rose 21.3% to 246.86 billion yuan, accounting for 15.7% of China's total imports of agricultural products in the same period, 1.4 percentage points higher than the previous year.

Economic and trade relations between China and ASEAN have a solid foundation and great potential for development. Looking forward, the two sides will enjoy broad areas of cooperation, integrated development strategies and smooth trade exchanges. Driven by the continuous improvement of trade and investment liberalization and facilitation, China-ASEAN trade is expected to achieve new and greater development. Thank you.

Nihon Keizai Shimbun:

We've been keeping an eye on trade between China and Russia. Could you share the data on China-Russia trade in 2022 and the GACC's assessment of trade between the two countries last year? Thank you.

Lyu Daliang:

Thank you for your question. I'll brief you on the relevant data on China-Russia trade. According to customs statistics, our imports and exports with Russia reached 1.28 trillion yuan in 2022, accounting for 3% of China's total foreign trade. In terms of scale, China-Russia trade maintained steady growth in 2022, and bilateral trade reached a new high. Thank you.

Nanfang Daily:

It has been one year since RCEP came into effect, and the benefits continue to be realized. Could you share with us the details about China's trade with other RCEP countries? What has the GACC done to promote the implementation of RCEP? And what has been achieved? Thank you.

Lyu Daliang:

Thank you for your questions. On Jan. 1, 2023, we marked the first anniversary of RCEP coming into effect. Over the past year, China has implemented RCEP with a high level of quality, reaped numerous policy dividends, and further promoted regional economic integration. According to customs statistics, China's imports and exports to the 14 other RCEP member countries in 2022 reached 12.95 trillion yuan, a 7.5% increase, accounting for 30.8% of China's total imports and exports. The trade has the following characteristics:

First, the proportion of imports and exports has steadily increased. As RCEP policy dividends continued to be released, its role in promoting intra-regional trade became more evident. From the first to the fourth quarter, China's imports and exports to other RCEP member countries accounted for 30.4%, 30.5%, 30.7% and 31.4% of China's total import and export in the same period, respectively.

Second, the trade has been dynamic. In 2022, China's trade with eight RCEP member countries exceeded double-digit growth, among which Indonesia, Singapore, Myanmar, Cambodia and Laos all experienced growth of over 20%. Our trade with the ROK was the largest among RCEP countries, reaching 2.41 trillion yuan, a 3.2% increase.

Third, industrial cooperation has been strengthened. In 2022, China's imports and exports of intermediate products to other RCEP member countries reached 8.7 trillion yuan, an 8.5% increase, accounting for 67.2% of China's total imports and exports with other RCEP member countries in the same period. In terms of major commodities, China's exports of mechanical and electrical products and labor-intensive products to other RCEP member countries went up by 13.2% and 20.7%, respectively. Electronic components, batteries and automobiles increased by 15%, 50.3% and 71.6%, respectively. China's imports of mechanical and electrical products, metal ore and ore sands, and consumer goods from other RCEP member countries accounted for 46.2%, 10.4%, and 10.2%, respectively. The import of energy products such as crude oil and natural gas also grew rapidly.

Fourth, private enterprises have had a strong performance. In 2022, the import and export of private enterprises to other RCEP member countries reached 6.56 trillion yuan, up 17.4%. This accounted for 50.6% of China's total imports and exports to other RCEP member countries in the same period, an increase of 4.3 percentage points over the previous year. 

Over the past year, the GACC has resolutely implemented the requirements of the CPC Central Committee and the State Council on RCEP implementation and conscientiously carried out various customs-related work.

First, together with the Ministry of Commerce and four other departments, we jointly issued the Guidelines on High-Quality RCEP Implementation, breaking down and refining 16 key tasks in three aspects and promoting the special evaluation of the implementation of RCEP-related measures at customs across the country. Second, we focused on the rules of RCEP in the field of customs inspection and quarantine, and improved relevant rules and regulations. We upgraded the customs operating system, standardized and simplified customs procedures, and continuously optimized the customs clearance process, in a bid to improve customs clearance efficiency and reduce costs. Third, we actively served enterprises, helping them seize the opportunities of RCEP and making full use of various preferential policies. Through publicity, training, seminars, visits and translation of regulations and standards of RCEP member countries, we helped them tap the RCEP market. We have built an enterprise-oriented service system targeting the role of RCEP in reducing technical barriers to trade, and released the interpretation of relevant measures and policies of RCEP members through the official Customs 12360 WeChat account and our portal website. We have introduced the approved exporter system, intelligent verification and self-printing of the RCEP certificates of origin, and other facilitation measures, providing quality services and guarantees for enterprises to enjoy benefits. Thank you.

Hong Kong Bauhinia Magazine:

As mentioned in the report to the 20th CPC National Congress, the Belt and Road Initiative has become a popular international public good and cooperation platform. Last year, China's trade with countries along the Belt and Road grew faster than the overall growth rate. What are the highlights? Thanks!

Lyu Daliang:

Thanks for your question. This year marks the 10th anniversary of the Belt and Road Initiative. Since its proposal, China's trade with countries along the Belt and Road has become increasingly close. From 2013 to 2022, China's imports and exports with countries along the Belt and Road registered an average annual growth of 8.6%. In 2022, China's trade with countries along the Belt and Road continued to maintain rapid growth, with imports and exports rising 19.4% year on year to 13.83 trillion yuan, 11.7 percentage points higher than the overall growth rate. Among them, exports hit 7.89 trillion yuan, up 20%, and imports reached 5.94 trillion yuan, up 18.7%. Major highlights include the following aspects.

First, its share of China's foreign trade continued to rise. In 2022, China's import and export volume with countries along the Belt and Road reached a record high, accounting for 32.9% of China's total foreign trade, up 3.2 percentage points from the previous year and 7.9 percentage points from 2013 when the Belt and Road Initiative was proposed. 

Second, China's imports and exports with the five Central Asian countries, the United Arab Emirates, Saudi Arabia and other trading partners grew rapidly. In 2022, China's imports and exports with the five Central Asian countries, the United Arab Emirates and Saudi Arabia increased by 45.4%, 42.1% and 37.2%, respectively. In the same period, China's imports and exports with ASEAN increased by 15% to 6.52 trillion yuan, accounting for 47.1% of the total value of China's imports and exports with countries along the Belt and Road.

Third, the industrial and supply chains between China and BRI countries have become even more complementary. In 2022, China's exports of intermediate products to BRI countries amounted to 4.44 trillion yuan, up 23.9%, accounting for 56.3% of China's total exports to BRI countries during the same period. Specifically, exports of textiles, electronic components, basic organic chemicals, and auto parts increased by 14.5%, 21.1%, 31.3%, and 24.6%, respectively. In the same period, China's imports of energy and agricultural products saw steady growth, reaching 2.46 trillion yuan and 370.41 billion yuan, up 58.8% and 13.4%, respectively.

Fourth, trade between China's private businesses and BRI countries has shown greater vitality. In 2022, the foreign trade of China's private companies with BRI countries totaled 7.85 trillion yuan, up 26.7%. The figure accounts for 56.8% of China's total trade volume with BRI countries in the same period, up 3.3 percentage points compared with the previous year.

In 2022, the GACC earnestly studied and put into practice the guiding principles of General Secretary Xi Jinping's important speech at the third symposium on the BRI. The GACC took the initiative to promote trade facilitation and security, and work toward the high-quality development of the BRI. First, Chinese customs actively expanded imports of high-quality agricultural products and foods from BRI countries. In 2022, Chinese customs signed 73 documents on inspection and quarantine cooperation with BRI countries, offering quarantine access or enabling trading activities for 60 kinds of agricultural products and foods. Second, focusing on BRI countries, Chinese customs promoted international mutual accreditation of and cooperation on Authorized Economic Operator (AEO) programs and advanced cooperation and exchanges on "single-window customs clearance" for international trade to further improve trade facilitation. Third, Chinese customs doubled efforts to streamline customs clearance procedures for China-Europe freight trains. At the beginning of 2022, the Partnership Program of Customs-Railway Operators for Promoting the Safety and Rapid Customs Clearance of China Railway Express (PPCR) between China and Kazakhstan began its trial phase at the Alashankou Port and Horgos Port. The PPCR arrangement between China and Belarus is also making accelerated progress in a bid to promote unimpeded trade.

Looking ahead, the customs authorities will focus on the high-quality development of the BRI, put into practice the concept of "Smart Customs, Smart Borders, Smart Connectivity ," and broaden and deepen cooperation with customs agencies of BRI countries and regions. In this way, we aim to make greater contributions to promoting policy coordination, infrastructure connectivity, and unimpeded trade. Thank you.

Red Star News:

Since last year, China has introduced a package of policies and follow-up measures to keep the economy stable. What efforts have the customs authorities made to ensure a steady increase in both the volume and quality of foreign trade? Thank you.

Lyu Daliang:

Thank you for your question. In 2022, the customs authorities resolutely implemented the guiding principles of General Secretary Xi Jinping's important instructions. We acted in accordance with the key requirements of ensuring effective COVID-19 containment, economic stability, and development security. The customs authorities have effectively coordinated the COVID-19 response with the efforts to ensure the stable growth of foreign trade, facilitated the implementation of the policy package and follow-up measures on keeping the economy stable, and spared no effort in ensuring a steady increase in both the volume and quality of foreign trade. Our actions can be mainly summarized in the following aspects.

First, we urged all customs authorities to fully implement the policies and measures for ensuring stable performance in foreign trade. The GACC successively introduced 10 measures to promote stable and improved performance in foreign trade, six measures to support small- and medium-sized enterprises, and seven measures to ease businesses' difficulties and lower their costs. Customs authorities at all levels acted accordingly, rolled out more than 1,300 detailed supporting measures according to specific conditions and the needs of enterprises, and redoubled their efforts in terms of protecting the interests of market entities, optimizing the customs clearance environment for the smooth flow of cross-border logistics, and safeguarding the stability and security of industrial and supply chains based on more careful analysis so as to ensure steady growth in foreign trade.

Second, to keep the operations of foreign trade firms stable, we provided consistent support, improved long-term service mechanisms, and helped them secure orders, expand markets and solve problems. We deepened the reform of diversified customs tax guarantees. We also promoted the practice of a subsidiary applying for customs guarantees with letters issued by the financial company of its parent to further reduce enterprises' financing costs and tax payments during customs clearance. "One policy for one enterprise" helped specialized and sophisticated enterprises that produce new and unique products and top enterprises of various industries to effectively use preferential measures regarding tax reduction and exemption, bonded material circulation, and so on. We supported more enterprises in becoming Advanced Certified Enterprises , facilitated the international mutual recognition of AEOs, and worked to enable enterprises to enjoy the same conveniences at home and abroad. In 2022, an additional 365 enterprises were classified as Advanced Certified Enterprises. We strengthened customs protection of intellectual property rights to inspire enterprises' enthusiasm for innovation. A total of 21,000 protection filings were added, registering an increase of 21%.

Third, to optimize the business environment at ports, we took special-purpose actions to promote cross-border trade facilitation, launched 10 facilitation measures in collaboration with other departments, promoted the application of single-window document processing for international trade, and consolidated the achievements in shortening customs clearance time. We increased the input of manpower and resources for customs clearance at ports, piloted shipside pickup for imported goods and direct loading upon arrival for exported goods at qualified ports, supported the expansion of pilot programs, such as "departure confirmation" and other models, and made every effort to ensure safe and smooth customs clearance at ports and facilitate the import and export of goods. In December 2022, the overall customs clearance time for imports and exports across the country was 32.02 hours and 1.03 hours, respectively, 67.1% and 91.6% shorter than in 2017.

Fourth, to foster new growth drivers in foreign trade, we have continued publicizing policies and measures for cross-border e-commerce. We have promoted central warehouses for the return of imported cross-border e-commerce retail goods and the B2B export supervision model, introduced measures to support enterprises in setting up overseas export warehouses, and continuously improved the quality and level of cross-border e-commerce development. As I said just now, China's cross-border e-commerce imports and exports climbed 9.8% year on year to 2.11 trillion yuan in 2022, of which exports were 1.55 trillion yuan, an increase of 11.7%, and imports were 0.56 trillion yuan, an increase of 4.9%.

In the next stage, customs authorities will thoroughly study and implement the guiding principles of the 20th CPC National Congress, conscientiously implement the decisions and deployment of the Central Economic Work Conference, continue to ensure the full implementation of policies and measures for keeping the economy stable, and go all out to maintain the scale and improve the structure of foreign trade so as to make new contributions to steady economic development. Thanks.

Xing Huina:

Today's press conference is hereby concluded. Thank you, Mr. Lyu. Thank you to all our friends from the media. Goodbye.

Translated and edited by Lin Liyao, Liu Qiang, Mi Xingang, Yuan Fang, Yan Bin, Zhou Jing, Cui Can, Huang Shan, Qin Qi, Wang Wei, Yan Xiaoqing, Zhang Rui, Xiang Bin, Zhu Bochen, Zhang Liying, Liu Sitong, Wang Qian, Wang Yiming, Yang Xi, Xu Xiaoxuan, Li Huiru, David Ball, Tom Arnsten, and Jay Birbeck. In case of any discrepancy between the English and Chinese texts, the Chinese version is deemed to prevail.

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Read in Chinese

Speakers:

Xu Chengguang, deputy director of the 2023 Spring Festival Transportation Special Group and vice minister of transport

Chen Kai, deputy director of the State Post Bureau

Wan Xiangdong, chief pilot of the Civil Aviation Administration of China (CAAC)

Huang Xin, director of the Passenger Transport Department of China Railway

Cai Tuanjie, deputy director of the Office of the 2023 Spring Festival Transportation Special Group and director general of the Transport Service Department of the Ministry of Transport (MOT)

Chairperson:

Xing Huina, deputy director general of the Press Bureau of the State Council Information Office (SCIO) and SCIO spokesperson

Date:

Jan. 6, 2023

Xing Huina:

Ladies and gentlemen, good morning. Welcome to this press conference held by the State Council Information Office (SCIO). Today, we are joined by Mr. Xu Chengguang, deputy director of the 2023 Spring Festival Transportation Special Group and vice minister of transport. Mr. Xu will brief you on the work to ensure services during the Spring Festival travel rush and take your questions. Also joining us today are Mr. Chen Kai, deputy director of the State Post Bureau; Mr. Wan Xiangdong, chief pilot of the Civil Aviation Administration of China (CAAC); Mr. Huang Xin, director of the Passenger Transport Department of China Railway; and Mr. Cai Tuanjie, deputy director of the Office of the 2023 Spring Festival Transportation Special Group and director general of the Transport Service Department of the Ministry of Transport (MOT).

Now, I'll give the floor to Mr. Xu Chengguang for a brief introduction.

Xu Chengguang:

Ladies and gentlemen, friends from the media, good morning. It is my pleasure to meet with you here. To begin with, I would like to thank the friends from the media for their interest in the plans regarding the Spring Festival travel rush and their support for our work concerning transportation. Today, my colleagues, Mr. Chen, Mr. Wan, Mr. Huang, Mr. Cai, and I will brief you on the measures to ensure transportation services during the 2023 Spring Festival.

The Spring Festival travel rush in 2023 is the first of its kind since the 20th National Congress of the Communist Party of China (CPC) and also the first since China's COVID-19 response entered a new stage. The CPC Central Committee and the State Council have attached great importance to it. The matter has drawn widespread attention from all sectors of society, and the people are looking forward to it. To ensure a smooth Spring Festival travel rush, we will follow the guidance of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, fully implement the guiding principles of the 20th CPC National Congress, and put people and their lives first. We will better coordinate epidemic prevention and control measures with economic and social development. We will meet people's needs for a better travel experience and maintain normal economic and social order, regard them as our fundamental missions, and make every effort to ensure steady and orderly operation during the upcoming Spring Festival travel rush.

The Spring Festival travel rush this year will last for 40 days, running from Jan. 7 to Feb. 15. Compared with previous years, passenger flows and the pandemic situation have reached peak levels simultaneously in 2023, making the upcoming travel rush the most uncertain, complicated and challenging in recent years. In general, this year's Spring Festival travel rush has the following four features. First, passenger flows will increase significantly. As China has classified and also treated COVID-19 as a category B infectious disease, more people will engage in cross-regional travel at an accelerated pace. In addition, people's demand for returning to their hometowns during Chinese New Year, visiting friends and family, and traveling will be unleashed collectively. As a result, passenger flows during the upcoming Spring Festival will recover from a long-term low level and see rapid increase, while transportation organizations will operate at full capacity. According to preliminary analysis, around 2.095 billion passenger trips will be made during this year's Spring Festival travel rush, up 99.5% year on year, which will recover to 70.3% of the same period in 2019. In terms of the structure of passenger flows, it is estimated that family visits will account for 55% of the total passenger flows, work-related travel 24%, and tourism and business trips 10% each. As many universities and colleges started their winter vacations before the travel rush, students will account for a relatively small proportion of passengers compared with previous years. More people will choose to travel by driving, using intercity car-pooling services, and taking chartered buses . Estimates suggest that expressways nationwide will report an average daily flow of 26.2 million passenger cars, up 3.6% year on year. In terms of the times and places people will travel, it is expected that before the Spring Festival, the majority of people will travel from large cities to nearby cities and provinces that are major exporters of labor. As family visits and work-related travel are to overlap, passenger flows will report growth. After the Spring Festival, people will travel from major labor exporting provinces and small- and medium-sized cities to central cities. Passenger flows during this period will be relatively staggered and reach peaks on around Jan. 27 and Feb. 6. Second, the demand for freight transport will rise significantly. The Spring Festival travel rush in previous years has often seen an increase in passenger flows and decrease in freight transport. However, as the pandemic situation is set to reach peak levels during the upcoming Spring Festival, the freight volume of all sorts of medical supplies and preventative materials, daily necessities for the holidays, and key materials such as energy and food for winter and spring will surge. In particular, in small- and medium-sized cities and rural regions with poor logistics infrastructure, parcel delivery may be delayed in certain areas as front-line delivery workers will return to their hometowns and possible large-scale infections will cause personnel shortages. Therefore, we will face mounting pressure in coordinating passenger flow with freight transport during the Spring Festival travel rush and ensuring the smooth operation of both. Third, front-line workers are at a greater risk of infection. The Spring Festival travel rush will see intensive passenger flow and frequent freight transport. As such highly-efficient transport activities overlap with the peak of the pandemic, the risk of large-scale infection among front-line transportation workers will surge, and there will be greater pressure to ensure unimpeded services of passenger flows and freight transport. Fourth, risks and hidden dangers concerning workplace safety will increase. Since 2020, due to the repeated impact of the pandemic, China's transport sector has been facing a complicated situation where the risks of traffic safety and pandemic-related incidents intertwined. Particularly, the sector has been operating at a low capacity for a long period; vehicles have either been out of service or operating at a low capacity for a long time; the working skills of employees in the field have been getting rusty; and there are often more traffic accidents around Chinese New Year due to frequent severe weather conditions such as low temperatures, cold fronts, rain, snow and sleet. All of these pose severe challenges to workplace safety. In order to strengthen the management of workplace safety, prevent major accidents, effectively respond to emergencies and ensure people's safe traveling experience, all levels of the transportation sector should make more greater efforts.

It is worth noting that this year's Spring Festival travel rush is marked by many uncertainties, making it difficult to rely on past experience to analyze and assess the situation according to established rules. The current projections on the total volume, composition, and direction of passenger flow are based on current circumstances. They are intended to consider worst-case scenarios, make more solid preparations, and provide better services in accordance with bottom-line thinking. This will allow us to be fully prepared for epidemic prevention and control and transport service guarantees during the Spring Festival travel rush. We will closely track the situation, continuously study and assess it, and promptly optimize and adjust our measures to ensure sound transportation services during the Spring Festival.

Facing these challenges and pressures, the Party Central Committee and the State Council have put forward three precise requirements of "meeting the travel needs of the people, reducing the risk of COVID-19 transmission, and providing safe and convenient services." Leading comrades of the Central Committee have repeatedly issued important instructions and made clear requirements. Transport departments at all levels have made adequate preparations in accordance with the "highest standards, strictest requirements, and most practical measures." At the national level, with the approval of the State Council joint prevention and control mechanism, a special task force on Spring Festival travel rush was set up under the State Council joint prevention and control mechanism, led by the MOT and involving 16 ministries and units. A series of documents have been issued, including the Overall Work Plan for Epidemic Prevention and Control and Transportation Service Guarantee during the 2023 Spring Festival Travel Rush. In addition, a series of specific measures have been formulated, such as guidelines for epidemic prevention and control during the Spring Festival travel rush. A national television and telephone conference was held to systematically deploy the work. Regions and relevant departments have also made specific arrangements according to the deployment of the Spring Festival travel rush task force. At present, all preparations are basically in place.

The annual Spring Festival travel rush is always a big test for transport authorities, but this year's "exam" may prove even more challenging. General Secretary Xi Jinping said that when faced with major and difficult tasks, one's sense of responsibility and bravery in taking on the challenge is tested. All transportation workers fully understand the extreme importance of doing a good job in ensuring sound transportation services during the Spring Festival this year. We consider providing transportation services during this year's Spring Festival as an important test for implementing the spirit of the 20th CPC National Congress. To ensure that people travel safely and successfully during the Spring Festival, we will utilize our maximum capacity and provide the best services and conditions to create a safe, healthy, convenient, and comfortable transportation experience. We will do our utmost to ensure that the "first" and "last" kilometers of the journey home are smooth and organized, with a sense of responsibility to work hard for the benefit of the public and with a determination to collaborate and support each other. In this way, we aim to contribute to a peaceful and joyful Spring Festival for the people and to give a satisfactory answer to the Party and the people.

That's all for my introduction! Now, my colleagues and I would like to take your questions. Thank you!

Xing Huina:

Thank you for your introduction, Vice Minister Xu Chengguang. Now we will open the floor for questions. Please identify the media outlet you represent before raising a question.

China Media Group: 

The 2023 Spring Festival travel rush kicks off tomorrow. Just now, the spokesperson mentioned that this year's Spring Festival travel rush will see a significant increase in passenger flow. Could you provide us with a more specific forecast? Additionally, what measures has the transportation department put in place to ensure smooth and organized travel for the public? Thank you.

Xu Chengguang:

Thanks for the questions. In an earlier briefing, I explained the total amount of passenger traffic and their possible destinations. We predict massive growth in passenger traffic during this year's Spring Festival travel rush, nearly double that of the previous year. However, passenger traffic will only reach 70% of what it was in 2019. In the first place, I want to say that we fully consider the anticipated demands of public transport, maintain bottom-line thinking, and consider extreme scenarios such as huge passenger traffic, large numbers of infections among transportation workers, and a high frequency of safety accidents. We are fully prepared according to the three principles of full preparation, allocation according to demands, and timely responses. We have the ability to provide the public with adequate transportation services. There are four specific measures:

First, we will strictly implement relevant policies. We will follow the related policies and regulations of the Joint Prevention and Control Mechanism of the State Council and carry out measures to optimize pandemic prevention and control and manage COVID-19 as a Class B infectious disease, through well-conceived and precise approaches. We are committed to implementing pandemic prevention and control policies in the railway, road, waterway, civil aviation, and post and delivery sectors to enhance the protection of passengers and people working in such sectors. The special task force set up for the Spring Festival travel rush will coordinate member entities to strengthen guidance and planning. We will explore policies regarding flexible and staggered holidays to relieve the congestion of people visiting families and reduce concentrated travel pressure. For the movement of migrant workers, we will determine a reasonable timetable for temporarily stopping work before the holiday and resuming work afterward for workers to travel home and back to work at various times. For the movement of students, we will adjust and optimize holiday arrangements and guide students to return to school at staggered intervals to avoid heavy traffic. For the movement of tourists, we will set a reasonable ceiling for tourist numbers to ensure orderly movement. 

Second, we will strengthen the coordination of transport capabilities. We will take full advantage of comprehensive transportation, enhance the effective linkage of different transportation modes, and enhance coordination regarding operating time, organization and arrangement of traffic capacity. We will try our best to handle the dispersal of large passenger flows to smooth their "last mile" of travel. For migrant workers and students, who tend to travel at similar times, we will provide team service and door-to-door service to ensure the orderly movement of workers and staggered travel time of students. If conditions allow, point-to-point chartered vehicle services will be arranged. To address people's travel demands for visiting family and shopping at fairs in rural areas, shifts will be increased for passenger routes between urban and rural areas. Operating hours will be extended, and reservation services will be improved. We will do more to ensure transportation services are provided.

Third, we will optimize passenger services. To improve services for the Spring Festival travel rush, we will work hard to refine the travel experience of the public. Information sharing and capacity coordination between different transportation modes will be enhanced to improve passenger transfer efficiency. Ticket services will also be upgraded, and information about passenger transport will be released via multiple channels and in a timely manner. The pre-ticketing service will be available in advance for passengers so they may arrange travel at staggered intervals. We will assess passenger traffic according to changes, increase ticket windows, self-service terminals and security lanes in a timely manner, and promote measures such as online ticketing, e-ticket, and self-service ticket checking to expand paperless and non-contact services. We will improve barrier-free facilities and offer necessary help to passengers in need, including elderly people, children, sick people, people with disabilities and pregnant women. 

Fourth, we will strengthen services for managing the road network. We will reinforce the monitoring of main road networks and city roads, pay close attention to traffic on road networks near provincial boundaries, in popular cities and around important scenic areas, and promptly release information about road conditions and traffic congestion. We will guide drivers to choose their routes, travel time and destinations rationally to avoid peak traffic. We will ensure the operation of expressways and service areas, roads, waterways and locks, and commercial passenger transport services, and ensure services such as refueling, battery charging, dining and restrooms at service areas. 

And in the second place, although the pandemic is not over yet, and some places are still experiencing peak infection levels, many people still wish to return home for the Spring Festival to visit relatives and friends. However, we strongly encourage everyone to make reasonable travel decisions considering their own personal circumstances and those of their family members. This is particularly important for elderly individuals with underlying health conditions and families with expectant mothers, infants and children, as they should minimize travel to lower the risk of infection during the journey for themselves and their family members. People using public transport to travel home for the Spring Festival should strengthen self-protection, wear masks throughout the journey, ensure personal hygiene, and actively avoid traveling while still having symptoms. Thank you.

ThePaper.cn:

What is the CAAC's forecast for civil aviation transport during this year's Spring Festival travel rush? What preparations have been made to guarantee civil aviation services during the travel rush?

Wan Xiangdong:

Thank you for your question. As the first travel rush after China optimized its virus prevention policies and the downgrading of the management of COVID-19 from Class A to Class B, it is expected that the number of passengers traveling by civil aviation will increase significantly. During the Spring Festival travel rush, civil aviation departments nationwide will schedule 11,000 passenger flights on average per day, which is about 73% of that during the 2019 Spring Festival travel rush. It is expected that the overall passenger flow will exhibit characteristics of staggered travel for school holidays and going back to school, for returning home and getting back to work, and for trips and other journeys. There will still be peak passenger levels around the Spring Festival holiday and after the Lantern Festival. Based on current ticket bookings for the Spring Festival travel rush, the peak appears from Jan. 18 (the 27th day of the 12th lunar month) to Jan. 20 (the 29th day of the 12th lunar month). Given the booking volume, air routes, including Beijing to Sanya, Shanghai to Beijing, Beijing to Haikou, Shenzhen to Kunming, Shenzhen to Chongqing, Hangzhou to Kunming and Shenzhen to Chengdu, rank among the top.

On the premise of ensuring safety, the CAAC actively guides airlines to arrange flight plans in a rational and well-conceived manner to ensure transport capacity and guarantee resources.

First, we support adding domestic flights during the Spring Festival travel rush and encourage airlines to deploy capacity more flexibly. This will accommodate passenger travel to popular destinations and along popular routes, such as routes from Beijing, Shanghai, Guangzhou and other cities to Sanya, Haikou, Chengdu and Chongqing.

Second, we require all airports to strengthen contact with Spring Festival travel agencies of local governments, and inform them in advance of information, including arrival and departure flights at night and passenger volume, so that they can actively cooperate to ensure a smooth connection with the "last-mile" in urban traffic. As of Jan. 5, on top of regular domestic passenger flights, 10,313 domestic flights had been approved to be added during the Spring Festival travel rush, including 3,459 flights along routes involving Beijing, Shanghai and Guangzhou, accounting for 33.5% of the total added domestic flights. This will effectively meet passengers' travel needs to popular places and along popular routes.

In terms of guaranteeing aviation services, all civil aviation departments will continue to follow the people-centered development philosophy and implement the work requirements of providing earnest services. The goal is to improve people's sense of security, gain and happiness for civil aviation services and ensure passenger services during the Spring Festival travel rush.

First, we will fully consider subjective and objective factors such as the market and weather and further optimize flight schedules, to effectively reduce the inconvenience caused to passengers by flight cancellations and delays.

Second, we will ensure epidemic prevention and control, guide passenger flow, reduce passenger gatherings, and try our best to provide non-contact services to passengers. We have tested and monitored the health conditions of front-line employees, and cleaned, disinfected and ventilated key places to reduce infection risks for passengers, so as to ensure safe and sound trips for them.

Third, we will ensure all aspects of service are properly attended to both onboard and on the ground. Specific focus will be given to passengers with special needs, including those with disabilities, the elderly, and unaccompanied children, in order to create a civilized, warm and harmonious travel environment.

Fourth, we will increase the answering rate of customer service calls by taking measures like increasing hotlines and service personnel to promptly handle passengers' various service demands. Thank you.

China Transport News:

Railways play an important role in the Spring Festival travel rush every year. What new measures will the railway authorities adopt this year? Thank you.

Huang Xin:

Thank you for your question. As regards this year's travel rush, China Railway will conscientiously implement the relevant deployments and requirements of the CPC Central Committee and the State Council on the work of the Spring Festival travel rush, continue to adhere to the people-centered development philosophy, take better-coordinated steps to respond to COVID-19 and the travel rush, and better coordinate development and security. We will optimize the train operation plan for the Spring Festival travel peak season, and accurately implement the epidemic prevention and control measures. On the basis of reviewing good practices from the past, we will launch a series of measures to help people in different links of purchasing tickets, waiting and boarding, so as to ensure safe, orderly and warm Spring Festival travels, and provide passengers with a better travel experience.

In terms of capacity arrangement, we will make scientific and precise arrangements. We will coordinate and make good use of new lines and new stations opened last year, as well as newly operated advanced equipment such as Fuxing bullet trains, to enhance the overall function of the rail network and improve passenger capacity. Following the principles of "sufficient arrangements, on-demand start, quick response and emergency preparedness," we will scientifically arrange the train operation schedule.

In terms of orderly travel, it is necessary to create a healthy and safe travel environment for passengers. We will conscientiously implement various measures for COVID-19 prevention and control and security management, strengthen the organization of passenger flows at stations, strictly control the occupancy rate of trains, and guide passengers to enter stations and wait for trains in an orderly manner, and maintain a safe distance. We will strengthen ventilation and disinfection in key places to maintain a good environment in trains and stations, actively promote contactless services, strengthen the promotion of travel health tips, improve employee health management, and guide passengers to wear masks throughout the entirety of their journeys to enhance their own health protection.

In terms of station and train services, we will focus on introducing measures to improve convenience for passengers in three aspects. First, we will improve ticket purchasing services. We will further optimize the 12306 online ticket purchasing system, expand the application of electronic tickets, and fully implement digital management in the links of excess fare payment at stations and trains. Second, we will no longer set time requirements for student discount tickets. Students can purchase four one-way discount tickets at any time in each school year, which are convenient for them to use at any time throughout the year. Third, if a passenger refunds a ticket due to railway liability or force majeure, all connecting tickets can be refunded at the same time, and the refund fee will be waived. Passengers will no longer be charged a service fee for excess fares or changing tickets. Meanwhile, we will expand the scope of trains with discounted fares in the non-peak direction.

Regarding travel information services, we will introduce code scanning services on more than 3,200 high-speed trains. Passengers can scan the code on their armrest to check travel service information related to arrival and departure time, train locations, trains available for transfer, and transportation of other vehicles. They can also buy food and beverages, pay for ticket extensions, upgrade their seats and search for lost belongings. Meanwhile, we will improve the message notification mechanism of 12306 to ensure that passengers who have booked tickets via 12306 and logged accurate contact information receive updates about the suspension of trains and information changes. This will enable them to get up-to-date information about train operations and make better travel arrangements. 

In terms of transfer services, passengers are particularly concerned about transfer information during the Spring Festival travel rush. The number of stations where intra-station transfers are available has increased from 80 to 100. We will also improve service facilities and upgrade signposts to improve transfer efficiency and provide convenience for passengers during the Spring Festival travel rush. Thank you. 

China Daily:

We noticed that delivery delays and congestion occurred in many places some time ago. What measures has the State Post Bureau taken to respond to this and what is the specific situation like now? Thank you. 

Chen Kai:

Thank you for your questions. As you mentioned in your questions, couriers in some cities have been getting infected since mid-December last year. Some distribution centers and outlets could not operate normally due to labor shortages, which affected parcel handling and delivery. At the same time, due to the decline in circulation efficiency, the delivery efficiency of some outlets and related terminals was affected, resulting in partial backlogs. As we all know, the courier sector is a typical network economy. If one link is affected, it will spread to the whole network. We noticed that delivery was slow some time ago. In response to this, the State Post Bureau has paid close attention, made all-out efforts to remove obstacles in the postal and courier sector and focused on daily scheduling, careful deployment and smoothing terminal circulation to ensure the efficient operation of the postal express network. We have done our work in the following four aspects:

First, we strengthened network operation guarantees. We urged delivery firms to assume their social responsibility, asking them to minimize service interruptions caused by out-of-service outlets and minimize operational disruption due to the reduced efficiency of front-end collection to ensure the smooth running of the postal express network to the greatest extent. Delivery enterprises have also formulated work programs and emergency plans according to epidemic developments specific to different regions and stages to allocate staff scientifically and ensure the regular operation of staff on duty to the maximum extent. 

Second, we ramped up efforts to replenish the workforce. We guided delivery enterprises to ensure consignment in key areas, in key links, and of essential materials. They increased employee attendance and strove to maintain the service capacity through regional adjustment, temporary reassignment of management personnel, recruitment of temporary workers, and speeding up the return to work. 

Third, we ensured the health and safety of delivery workers. We have guided local postal administrations to actively seek resources from local governments to provide greater support to the industry in terms of vaccines, antigen test kits, medicines, and N95 masks. We've also instructed them to speed up distribution to ensure the effective protection of frontline express delivery workers. Localities like Shanghai and Jiangsu have offered subsidies to those on duty on the frontline.

Fourth, we accelerated the handling of backlogged packages. We have urged relevant companies to improve resource allocation, coordinate personnel, and speed up the handling of backlogs, while making sound preparations for potential package increases. We have guided company headquarters to formulate incentive policies to support terminal outlets in speeding up package flow. We have also encouraged terminal outlets to increase working capacity and effectively handle backlogged packages. These policies include increasing working efficiency, optimizing delivery routes, extending service time, and offering delivery services during night hours.

We have seen that, through continuous efforts in the previous stage, 94.9% of delivery workers nationwide had resumed work as of yesterday, the number of backlogged packages had sharply dropped, and express delivery services had effectively resumed. In the first five days of this year, the daily express delivery volume reached 370 million packages on average, up 16.7% compared with the same period last year. Going forward, the State Post Bureau will continue to mobilize the whole industry to consolidate work achievements and strengthen the foundation for stable industrial operation, do its best to ensure smooth delivery, and effectively meet the needs of the people for delivery services.

We will further urge relevant enterprises to increase their package handling efficiency according to the changing epidemic situation in different regions, and urge companies to increase their efforts to properly handle complaints and appeals and effectively resolve related problems and disputes, so as to meet the people's needs for delivery services. Thank you.

Phoenix TV:

My question is for the Civil Aviation Administration. What are the arrangements for flights to and from Hong Kong, Macao and Taiwan during the Spring Festival travel rush? Is there going to be a significant increase? Thank you.

Wan Xiangdong:

Thank you for your questions. The Civil Aviation Administration has always cared for air routes to and from Hong Kong and Macao as well as cross-Strait flights and supported airlines in opening air routes and flights to Hong Kong, Macao and Taiwan in accordance with the air transport arrangement between the mainland and Hong Kong and Macao as well as the cross-Strait air transport agreement.

In 2022, the Civil Aviation Administration issued or renewed 16 Hong Kong air operating licenses and three Macao air operating licenses. As of Jan. 5, the Civil Aviation Administration had approved a plan for 13,230 passenger flights to and from Hong Kong, Macao and Taiwan during the Spring Festival travel rush, involving 186 air routes and 47 waypoints on the mainland. Twenty-eight airlines will arrange 2,331 passenger flights every week.

After Jan. 8, airlines will independently and dynamically optimize the arrangement for passenger flights to and from Hong Kong, Macao and Taiwan based on the same principles as international ones — safety first, market-oriented, and special needs prioritized. Take Shanghai Pudong International Airport as an example. According to the flight scheduling of various airlines operating at the airport, from Jan. 8 to 31, there will be 30 daily passenger flights to and from Hong Kong, Macao and Taiwan taking off or landing at the airport. Among them, 10 are Hong Kong flights, eight are Taiwan flights, and 12 are Macao flights, all showing a significant increase. As market demand increases over time, we believe the number of flights will increase further. Thank you.

Cover News:

It is expected that this year will see an increase in passenger flows compared to previous years. How will the transport authorities ensure the safety of passengers and guarantee emergency responses to avoid major traffic accidents? Thank you.

Cai Tuanjie:

Thank you for your question. Safety has always been our top priority during the Spring Festival travel rush. We can have a peaceful Spring Festival only if we do an excellent job of providing security. This year, we face significant challenges in conducting safety inspections for the travel rush due to multiple factors, including increasing passenger and cargo flows, the changing epidemic situation and extreme weather. We have already made systematic arrangements for ensuring safety and emergency responses for the travel rush. Next, we will guide local governments to pay close attention to passenger and cargo flows, the weather and the epidemic situation. We will also direct them to focus on core elements such as passengers, vehicles and roads. Multiple efforts will be made to guide local governments to take concrete steps to fully secure a safe Spring Festival travel season. 

First, we will strengthen the inspection and maintenance of facilities and equipment. Some of our facilities and equipment have been operating at low capacity, leading to an increased risk of safety hazards. We will urge transportation companies to fully implement all safety production requirements and conduct comprehensive inspection and maintenance on facilities and equipment planned to be used during the Spring Festival travel season, to ensure they are in good technical condition. We will prevent problematic facilities and equipment from operating.

Second, we will strengthen our efforts to raise safety awareness among employees. Some of our employees' skills have become rusty due to the low workload. We will guide transportation companies to conduct targeted training and safety education for all employees engaged in the Spring Festival travel season, especially drivers, to enhance their awareness of safe driving. We must conduct strict checks on drivers to ensure they can perform their work duties safely. If drivers have symptoms such as a fever or are unable to work due to physical conditions, they should not be made to work. We should ensure that employees are fit for duty and that vehicles are fit for operation.

Third, we will strengthen the dynamic monitoring of transportation vehicles. We will monitor and manage tourist buses, passenger buses, vehicles transporting dangerous goods, and high-speed ferries during their operation, and promptly discover and address violations of laws and regulations, including speeding and driving while tired. We will urge transportation companies to pay close attention to weather changes and road traffic conditions, and promptly adjust or suspend transportation plans for those not meeting safe traffic requirements. We strictly prohibit dangerous operations and transportation.

Fourth, we will strengthen efforts to ensure safety on the road network. We will guide local governments to strengthen the monitoring of key road sections and road networks and conduct risk assessments on road sections such as large and long bridges and tunnels, as well as long, continuous downhill slopes, to address safety hazards in a timely manner. We will release information on weather and traffic control to facilitate the public in making travel plans. Suppose there are extreme weather events, such as cold waves, freezing rain and snow, and dense fog. In that case, we will publish weather warnings and conduct emergency responses, as well as carry out snow removal and deicing work in a timely manner, to recover road conditions as soon as possible. We will step up efforts to provide health services for passengers. We encourage passenger hubs, highway service areas, "driver's homes," and other places where conditions permit to set up "health stations" and health service points to provide drivers and passengers of private cars, passenger buses and cargo trucks with medicine and separate areas for rest. It is particularly important to mention that we do not encourage drivers with symptoms to get behind the wheel. If they have symptoms during their work, they need to rest and get medicine at the nearest service area. It is also advisable to avoid driving after taking medication and only return to work after resting to ensure safety.

Fifth, we will step up our duties and emergency response capabilities. During the Spring Festival travel rush, transportation departments at all levels will strictly implement the 24-hour duty plan with both leaders and assigned persons on duty to closely monitor the situation of the travel rush. In case of emergencies like adverse weather and traffic congestion, we will organize, coordinate and direct the emergency response in time to ensure smooth and orderly progress during the Spring Festival travel season. When people are stranded, hot water, food and necessary health services will be provided in time to enhance their sense of fulfillment regarding Spring Festival travel services.

During the Spring Festival travel season, many people from rural areas travel to return home, visit relatives and friends, and go to fairs. We will strengthen transport capacity and safety supervision. We will work with related departments to strengthen law enforcement supervision by focusing on rural passenger transport routes, passenger terminals and ferry ports. Here, I'd like to remind travelers to enhance their awareness of self-protection and safe travel. It is suggested to travel in legal vehicles, reject vehicles with passengers beyond the seating capacity, fasten seat belts, resolutely eliminate driving a vehicle without a license plate or driver's license, and avoid drunk driving to prevent and curb safety accidents.

Safety work is a journey to which there's no end. Let's work together to ensure a safe, smooth and orderly Spring Festival travel season so everyone can have a happy and peaceful Spring Festival. Thank you!

Hong Kong Bauhinia Magazine:

What progress has been made to ensure a smooth flow of logistics during the Spring Festival travel season? What efforts will be made to ensure efficient and orderly transportation of medical and livelihood supplies? Thank you.

Xu Chengguang:

Thanks for your questions. I will answer them.

For this year's Spring Festival travel rush, we have made full preparations for organizing the passenger transport and ensuring the smooth flow of transport and logistics, which will be coordinated and managed respectively by the Spring Festival travel season work team under the State Council inter-agency task force for COVID-19 response and the office of the leading group for the smooth flow of logistics under the State Council. In terms of transport and logistics, transportation arteries and logistics microcirculation in China are generally smooth. Key logistics hubs are running steadily. Major logistics indicators are stable and improving. The transportation of key supplies is safe and orderly. We are fully capable of meeting the transportation needs of supplies.

But at the same time, the public demand for medical supplies such as COVID-19 medicines, antigen detection reagents, masks and vaccines has surged recently. Given this situation, the office of the leading group for the smooth flow of logistics under the State Council, which considers it a priority, is strengthening overall deployment and coordination and sparing no effort to ensure the smooth transportation of medical supplies.

First, we need to connect supply and demand to ensure a timely response to demand. We will track the epidemic changes, monitor the transportation needs of key medical supplies across the country, and urge and guide local transport authorities to contact the 286 key enterprises ensuring medical supplies designated by the medical supplies group under the State Council inter-agency task force for COVID-19 response, taking the initiative to provide them with the needed services and make differentiated policies. For example, we have guided SF Express Group and China Post Group to customize their logistics plans to guarantee the daily transportation of 16,000 orders of Lianhua Qingwen capsules produced by Shijiazhuang Yiling Pharmaceutical, achieving "zero backlogs" in medical transportation and distribution. We have also promptly coordinated and solved the transportation problems of medical supplies for Fengyuan Pharmaceutical in Anhui and Fenhe Pharmaceutical in Shanxi.

The second is to ensure efficient traffic and smooth and orderly logistics. The transportation of medical materials requires a higher level of timeliness and precision than that of general materials. We have set up a daily scheduling system to enhance dispatching in key provinces and key logistics enterprises, ensuring the timely delivery of medical supplies. We will strictly implement the policy of giving priority to free passage on expressways for vehicles transporting COVID-19 vaccines to ensure safe and efficient deliveries.

The third is to smooth the end circulation to ensure timely delivery of materials. In some cities, a shortage of front-line couriers has caused poor delivery at the end of logistics. We have solved such problems as quickly as we can. We immediately carried out dispatch and deployment, urged timely recruitment of delivery personnel, encouraged businesses to open as many outlets as possible, prioritized the delivery of backlogged medical and prevention and control supplies, and worked hard to smooth the final delivery of medical materials.

Next, we will continue to focus on the transportation needs of medical supplies, promote the connection between supply and demand, ensure efficient passage, smooth the final delivery stage, and ensure efficient and orderly transportation of key materials. First, we will make every effort to meet the demands of transporting medical materials. We will guide key logistics enterprises to strengthen coordination with medical supplies production, operation and distribution enterprises to ensure timely and full response to transportation needs for medical supplies. Second, we will strengthen the transportation organization and capacity scheduling. We will guide large key logistics and transportation enterprises to formulate support plans for transporting medical supplies during the Spring Festival holiday, and encourage front-line employees to continue to work during the holiday by arranging staff rotation and off-peak leave, and issuing subsidies, overtime pay and other measures, so as to ensure that the transportation of medical materials is not interrupted during the holiday. Third, we will make every effort to smooth the final delivery service network. We will give full play to the role of large key postal express enterprises, and guide them to improve their contingency plans during the holiday. We will strengthen regional labor deployment, and pay close attention to the staffing of employees in small and medium-sized cities and rural areas. With these efforts, we will ensure the uninterrupted transportation of medical supplies during the Spring Festival travel rush.

Transportation and logistics are linked to people's livelihoods and are related to the overall stability of growth, employment and prices. While ensuring transportation services for key medical supplies, we will also continue to ensure the smooth flow of the "main artery" and "microcirculation." We will coordinate the transportation of key materials like energy and grain, and daily necessities like vegetables, fruit, meat, poultry, eggs and milk this winter and spring, so as to better serve the overall situation of economic and social development and ensure people's living needs and a warm winter.

Here, I would again like to remind drivers that if they encounter any obstacles during transportation, or if relevant supply enterprises face difficulties in logistics and transportation, they are welcome to call the local or national hotlines. We will coordinate services to see that their difficulties are addressed.

The Beijing News:

This year, some newly built railways will face the big test of the Spring Festival travel rush. What preparations have railway departments made? Can China's current railway capacity meet the demands of the Spring Festival travel rush this year? Thank you.

Huang Xin:

Thank you for your questions. This year's Spring Festival travel rush is the first after the central government optimized and adjusted the pandemic prevention policies, as pandemic prevention and control entered a new stage. Therefore, the population's travel demands may change significantly compared to previous years. The pre-sale of train tickets for the 2023 Spring Festival period started on Dec. 24, 2022. Looking at current ticket bookings, we have seen that travel demand in all aspects has increased significantly, and railway passenger flows are gradually recovering.

To properly ensure capacity for the Spring Festival travel rush, I mentioned earlier that we adhere to the principles of "adequate arrangement, on-demand activation, rapid response, and emergency preparedness," and the train operating plan has been arranged accordingly for the holiday travel rush. A daily maximum of 6,077 pairs of passenger trains will be put into operation during peak days before the holiday, with a seating capacity of 9.04 million passengers. Moreover, there will be a maximum of 6,107 pairs of trains per day after the holiday, with a seating capacity of 9.14 million people. Maximum seating capacity has increased by 11% compared with the same period in 2019, enabling us to better meet the travel demands of passengers during the Spring Festival travel rush. Regarding transportation capacity, we have prepared in three ways.

First, we will make good use of new lines, stations and equipment. Last year, 4,100 kilometers of new railway lines were put into operation nationwide, including 2,082 kilometers of high-speed railway. The accessibility and coverage of the railway network were further improved. During the Spring Festival travel rush, we will give full play to the advantages of our high-speed railway network. We will effectively use new lines and stations such as the Zhengzhou-Chongqing High-speed Railway, the Huzhou-Hangzhou High-speed Railway, the Yinchuan-Lanzhou High-speed Railway, the Beijing-Tangshan Intercity Railway, the new Chengdu-Kunming Railway, and Beijing Fengtai Railway Station, and advanced equipment such as the new Fuxing EMU trains. We will also make effective use of the 350-kilometer-per-hour speed achieved by the Beijing-Wuhan section of the Beijing-Guangzhou High-Speed Railway, enabling us to enhance efficiency and improve capacity for the Spring Festival travel rush.

Second, we will expand transportation capacity in key regions and times. Before the festival, 1,623.5 pairs of direct passenger trains will run daily in the areas with concentrated passenger flows, including Beijing, the Shanghai-Nanjing-Hangzhou region, and the Guangzhou-Shenzhen region, a year-on-year increase of 34.5 pairs. Meanwhile, 222 pairs of high-speed trains will run every night, a year-on-year increase of 25 pairs. After the holiday, 814.5 pairs of direct passenger trains will run daily in the cities of Chengdu, Chongqing, Wuhan and Nanchang, and Hunan province and other areas with concentrated passenger flows, a year-on-year increase of 18 pairs. Moreover, 135 pairs of high-speed trains will run each night, a year-on-year increase of 14 pairs. At the same time, we will maintain the necessary operation scale of normal-speed passenger trains, continue to run slow trains for public welfare, and ensure the travel needs of people in remote areas.

Third, we will establish an emergency response mechanism for unexpected passenger flows. We will analyze the patterns of passenger travel, study and assess the changing trend of passenger flows, adjust transport capacity at different stages, and achieve a good balance between transport capacity and demand according to pre-sale and waiting list data from ticket reservation website 12306.cn. According to current ticket bookings, before the festival, the transportation capacity are relatively short for those traveling from the Pearl River Delta and the Yangtze River Delta to the central and southwest regions. Therefore, we will adjust and supplement transportation capacity to meet the travel needs of passengers as much as possible. In order to cope with unexpected passenger flows, a certain number of EMUs and crew members will be on standby in major railway hubs for immediate deployment, ensuring we meet the travel demands of passengers. Thank you.

Beijing Youth Daily:

Just now, the State Post Bureau discussed the slowdown in express delivery services and the backlog of parcels that occurred a while ago. The Spring Festival is the peak season for people to return to their hometowns and travel; it is also the offseason for the courier industry. Can you judge whether there will be a shortage of couriers and a slowdown in express delivery services in the next stage? Are there any solutions? Thank you.

Chen Kai:

Thank you for your questions. During the Spring Festival, as many people return to their hometowns to celebrate the Lunar New Year or travel, people's need for express delivery services will significantly decline. According to the data of the past two years, the average business volume per day in the seven days of Spring Festivals accounts for about 15% of the average daily business volume of whole year in 2021 and 2022. It can be said that the Spring Festival is the offseason for the courier industry. Despite that, we hold that currently, it is a critical period for the optimization of epidemic prevention and control, and people are still in urgent need of delivery of medicines and materials for epidemic prevention and control and basic living. Therefore, for some time to come, especially during the Spring Festival, ensuring delivery services is of great significance for better coordination between epidemic prevention and control and serving economic and social development in the new situation. Taking that into consideration, the State Post Bureau has specifically formulated the work plan for the postal and courier industry on safeguarding delivery services during the 2023 Spring Festival. It has made special arrangements concerning the operation of the industry during the Spring Festival, mainly including the following four aspects:

First, the order of postal delivery services will be maintained. We will effectively play the role of the market and urge postal enterprises to keep providing stable universal postal services. We will guide major brand express delivery enterprises to make reasonable service commitments tailored to the actual delivery needs of different regions, issue the arrangements of services during the Spring Festival in advance, coordinate the transport capacity of the entire network, and arrange a necessary number of outlets and workers to ensure the effective operation of the service network of their brands.

Second, the delivery service for the "Lunar New Year's Shopping Festival" will be guaranteed. This year we will continue to work with the Ministry of Commerce and other departments to organize the Online Lunar New Year's Shopping Festival activity. We will guide the enterprises to make reasonable arrangements for production and operation during the holiday, promptly release the service arrangements to the public, and strictly act upon its announcements and commitments. We will urge enterprises to strengthen communication with upstream e-commerce enterprises to make a well-informed prediction about changes in the needs for services during the Lunar New Year's Shopping Festival and the Spring Festival and make reasonable arrangements for human resources and transport capacity to ensure the enterprises' regular operation.

As I have mentioned, in the first five days of this year, the business volume of express delivery nationwide has reached 1.89 billion pieces, providing support for the online retail sales of physical goods of more than 160 billion yuan. It can be said that the coordination between commodity circulation and express delivery and logistics plays an active role in stabilizing consumption.

Third, the need for delivery of medical supplies, including medicines, will be guaranteed. Together with the Ministry of Commerce, we jointly issued the notice on jointly guaranteeing the supply and delivery of medical supplies, guiding for delivery enterprises to make special marks on medical supplies, strengthen guarantees and give priority to its delivery to meet people's urgent needs for the delivery of medicines and other medical supplies. 

Fourth, practical measures will be taken to safeguard couriers' legitimate rights and interests. I believe you all remember that on Feb. 1, 2019, General Secretary Xi Jinping visited couriers at Shitou Hutong in Qianmen, Beijing. He said affectionately that couriers work really hard, getting up early and returning home late at night, making deliveries in all weathers, and getting even busier at holidays, and working the hardest just like busy bees to bring convenience to our life. We will fully implement the important instructions of General Secretary Xi Jinping and pay visits to couriers during the Spring Festival. We will urge delivery enterprises to coordinate the arrangement of rest and leave for those who work during the holiday and implement off-peak vacations or allow them to take their days off later. Couriers who work during the holiday should enjoy due overtime payments under the relevant laws, and subsidies to enterprises that maintain stable employee numbers will be ensured to guarantee their living.

Based on the current conditions, many enterprises have recently issued their operation plans during the Spring Festival, specifying the commitments of their brands to ensure services during the Spring Festival. We will further urge enterprises to fully implement their commitments and make serious efforts to ensure the quality of delivery services during the Spring Festival. Thank you.

Xing Huina:

Due to time constraints, we will have one last question.

Nanfang Metropolis Daily:

As the huge human migration involving 2 billion trips approaches, how will China respond to the challenges after having optimized the epidemic control management during the Spring Festival travel rush? What specific measures will be taken? Thank you.

Cai Tuanjie:

Thank you to the reporter. The epidemic prevention and control work plays a crucial role in ensuring transportation services during this year's Spring Festival. During the Spring Festival travel rush, the high flow of people and goods and extensive social activities increases the risk of infection. Based on these conditions and combined with the implementation of the measures adopted by China to treat COVID-19 as a Category B disease, the Spring Festival Transportation Special Group has issued the Guidelines on Epidemic Prevention and Control During the Spring Festival Travel Rush and Guidelines on Travel Services During the Spring Festival Travel Rush. We will guide regions to strengthen whole-chain management according to relevant requirements and documents, urge employees in the transportation industry to carry out effective and detailed implementation of epidemic control measures and guide the public to take personal protection measures, contributing to the effective and steady transition of the epidemic development and ensuring the smooth and orderly operation of transportation services during the Spring Festival. 

First, the organization and guidance of passenger flow will be enhanced. We will urge operators to strengthen disinfection and ventilation of airports and transportation hubs. Passenger flow will be organized in a better way. Passengers will be guided to form lines in key places including entrances, ticket windows, automatic ticket machines, security check lanes, and check-in gates. If conditions allow, passengers will be guided to maintain their distance in waiting rooms and sit apart from each other. Transport capacity will be increased in a timely manner for lines with large passenger flow to reduce gatherings.

Second, education programs will be conducted to raise public awareness of epidemic prevention when traveling. Everyone should be responsible for their own health. Here we would like to recommend that the public reduce travel to regions with high infection rates and people from these regions should also reduce travel and avoid traveling when they have symptoms. People should try not to take public transportation if they have not ruled out the risk of having been infected or when displaying symptoms such as fever. During their journey, passengers should increase their awareness of self-protection and strengthen personal protection throughout the entire trip. When taking public transportation, passengers should wear face masks during the entirety of their trip and try to reduce gathering.

Third, the adoption of contactless services will be encouraged. We will guide passenger transport operators to keep improving ticket services and take active steps to promote the application of services including online purchasing of tickets, e-tickets, and self-service check-in. The range of paperless and contactless services will be expanded. The smooth transition between railway, civil aviation and urban rail transit will be further advanced and the security check process will be optimized, so as to reduce the waiting time for transfers and public gathering and improve passengers' efficiency in transfer.

Fourth, the health management of transportation employees will be strengthened. We will urge operators to strengthen the health monitoring of transportation employees and carry out management of those with symptoms. Those who have symptoms such as fever should promptly report their situation, stop working and take a COVID-19 antigen test or nucleic acid test if necessary. Transportation employees are asked to strengthen self-protection. They should wear face masks during their work and practice good hand hygiene. Meanwhile, for service staff working in transportation hubs and highway service areas with large passenger flow and those working on the frontline in places such as toll booths, we advocate that they commute directly between their home and workplace. They should also wear N95 or KN95 face masks during their work. 

Fifth, epidemic prevention and control measures will be strictly implemented in airports and transportation hubs. We will urge operators to strengthen the daily public hygiene management in relevant airports and transportation hubs, highway service areas, toll booths, and some transportation vehicles. All of these public facilities will go through thorough cleaning and disinfection and ensure good ventilation. In areas where the epidemic situation is serious, the frequency of cleaning, disinfection and ventilation will be increased, and the windows of passenger vehicles will be opened regularly for ventilation. 

Sixth, effective measures will be taken to respond to large-scale infections of transportation employees. We will urge operators to strengthen the management of transportation employees in terms of epidemic control. Drivers will undergo strict and prudential examinations before going to work to ensure that their physical conditions meet the standards for safe driving. Mechanisms for staff rotation and backups in key positions and for cross-regional mobilization of personnel and transport capacity will be established and implemented. We will make preparations in case of the need to respond to large-scale infections of transportation employees, so as to ensure that the replacement of personnel is carried out in an orderly manner and that transportation services are not disrupted. 

We would also like to appeal to all regions to provide care for transportation employees. Highway service areas and service centers for drivers should if possible set up medical service stations, prepare necessary materials for epidemic treatment such as anti-fever drugs and provide necessary places for drivers to rest, so as to ensure that transportation employees can receive timely medical treatment and get the necessary rest when they have symptoms.

Next, we will pay close attention to developments in the epidemic nationwide, make timely adjustments to the relevant policies and supporting measures as circumstances change, and guide regions to take well-coordinated steps to prevent and control the epidemic and provide services for the Spring Festival travel rush. Thank you.

Xing Huina:

Today's briefing is hereby concluded. Any news organization that did not get a chance to raise questions today may contact us after the briefing. Thank you to all the speakers and friends from the media. Goodbye.

Translated and edited by Wang Yiming, Zhang Rui, Xu Xiaoxuan, Li Huiru, Yan Bin, Wang Wei, Yang Xi, Liu Qiang, Cui Can, Zhang Junmian, Duan Yaying, Huang Shan, Xiang Bin, Liu Sitong, Ma Yujia, Xu Kailin, Wang Qian, Zhu Bochen, Zhang Jiaqi, David Ball, Tom Arnsten, and Jay Birbeck. In case of any discrepancy between the English and Chinese texts, the Chinese version is deemed to prevail.

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Read in Chinese

Speakers:

Ms. Cao Shumin, vice minister of the Cyberspace Administration of China (CAC)

Ms. Qi Xiaoxia, director general of the International Cooperation Bureau of the CAC

Mr. Yang Shuzhen, director general of the Policy Research Bureau of the CAC

Ms. Sun Weimin, director general of the Cybersecurity Coordination Bureau of the CAC

Mr. Wang Song, director general of the Informatization Development Bureau of the CAC

Mr. Chen Renze, an official of the Cyber Communication Bureau of the CAC

Chairperson:

Ms. Xing Huina, deputy director general of the Press Bureau of the State Council Information Office (SCIO) and SCIO spokesperson

Date:

Nov. 7, 2022

Xing Huina:

Ladies and gentlemen, good morning. Welcome to this press conference held by the State Council Information Office (SCIO). Today, the SCIO published a white paper titled "Jointly Build a Community with a Shared Future in Cyberspace," and organized this press conference to introduce and interpret its main content.

The white paper fully implements Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, thoroughly puts into practice the guiding principles from the 20th National Congress of the Communist Party of China (CPC), and provides a comprehensive picture of the achievements in the development and management of the internet in China since the 18th CPC National Congress. The document elaborates on China's concepts, actions and contributions in strengthening international communication and cooperation in cyberspace and promoting the building of a community with a shared future in cyberspace. It also puts forward China's proposals on creating a community with a shared future in cyberspace.

At around 24,000 Chinese characters, the white paper consists of preface, main body and conclusion. The main body is divided into four parts: "Building a Community with a Shared Future in Cyberspace Is Essential in the Information Age," "Development and Management of the Internet in China," "China's Contribution to Building a Community with a Shared Future in Cyberspace" and "China's Proposals on Creating a Community with a Shared Future in Cyberspace."

The white paper is published in eight languages — Chinese, English, French, Russian, German, Spanish, Arabic and Japanese — by the People's Publishing House and Foreign Languages Press. It is available at Xinhua Bookstore outlets across the country.

To help you better understand the white paper, we have invited Ms. Cao Shumin, vice minister of the Cyberspace Administration of China (CAC); Ms. Qi Xiaoxia, director general of the International Cooperation Bureau of the CAC; Mr. Yang Shuzhen, director general of the Policy Research Bureau of the CAC; Ms. Sun Weimin, director general of the Cybersecurity Coordination Bureau of the CAC; Mr. Wang Song, director general of the Informatization Development Bureau of the CAC; and Mr. Chen Renze, an official of the Cyber Communication Bureau of the CAC. They will brief you on relevant information and then take your questions.

Now, I'll give the floor to Ms. Cao Shumin.

Cao Shumin:

Thank you, Ms. Xing. Ladies and gentlemen, friends from the media, good morning. It is my pleasure to brief you on the white paper "Jointly Build a Community with a Shared Future in Cyberspace."

Since the 18th CPC National Congress, the CPC Central Committee with Comrade Xi Jinping at its core has proactively conformed to the development trends of the information revolution, attached great importance to the internet, and engaged in development and governance of the internet. It has promoted coordinated progress in the development of cybersecurity and information technology (IT) and contributed to the historic achievements and changes in the sectors in China. In December 2015 during the second World Internet Conference (WIC), General Secretary Xi Jinping proposed the building of "a community with a shared future in cyberspace." The proposal expressed China's sincere wish to cooperate with the rest of the world in promoting the development of management of the internet. It also offered Chinese solutions and contributed Chinese wisdom to the sector.

Next, I will brief you on the main content of the white paper from four aspects.

First, building a community with a shared future in cyberspace is essential in the information age.

The world is currently undergoing accelerating changes unseen in a century. The new scientific and technological revolution and industrial transformation are gaining momentum. Problems with the internet such as unbalanced development, unsound regulation and unreasonable order are becoming more prominent, and cyber-hegemonism poses a new threat to world peace and development. Cyberspace governance requires more just, reasonable and effective solutions, and global threats and challenges necessitate joint efforts from around the world.

General Secretary Xi Jinping's important concept of building a community with a shared future in cyberspace has elaborated on a series of major principles and proposals for global internet development and governance. It comprises four principles: respecting cyber sovereignty, safeguarding peace and security, promoting openness and cooperation, and maintaining good order. It also noted that we should hold to a vision of extensive consultation, joint contribution and shared benefits in global governance; we should contribute to building a peaceful, secure, open, cooperative and orderly cyberspace; and we should build cyberspace into a community of common development and shared security, responsibility and interests.

The second aspect is the development and management of the internet in China.

The development and management of the internet in China has provided strong support for the nation's high-quality growth. This is summarized in the white paper from seven aspects.

First, the digital economy is thriving. By 2021, the value of the digital economy had reached 45.5 trillion yuan, accounting for 39.8% of GDP, and has become a major engine of growth for the nation's economy. Second, digital technologies have brought benefits and convenience to the people. China has proactively promoted internet application in public service sectors such as education and medical services, and fully leveraged the key role of the internet in promoting poverty alleviation and rural revitalization. Third, the legal framework for cyberspace continues to improve. China has established a complete cyber law system and enforced a number of laws such as the Cybersecurity Law, Data Security Law and Personal Information Protection Law. This has boosted the sound development of the internet within the bounds of the law. Fourth, China has developed rich and varied online content. Positive and mainstream ideas and opinions are spreading online. Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era has taken root in the hearts of the people, and the core socialist values are guiding the cultural development online. Fifth, the cyberspace is getting cleaner. We have launched Operation "Qinglang," promoted internet civilization and pooled positive energy. As a result, China's cyber ecosystem continues to improve. Sixth, the operation of online platforms continues to become more standardized. We have worked to improve the institutional arrangements and mechanisms which help enterprises to develop and regulate their operation. We are also stepping up regulation related to new technologies and applications, advancing the self-discipline of industry, and working to promote fair competition and orderly development on social media platforms. Seventh, China has effectively guaranteed cybersecurity. China has strengthened top-level design on cybersecurity and intensified efforts to protect critical information infrastructure. China has also enhanced its ability to ensure digital security, strengthened personal information protection and strived to crack down on cybercrimes.

The third aspect is China's contribution to building a community with a shared future in cyberspace.

Over the years, China has continued to strengthen dialogue and cooperation in cyberspace. The white paper elaborated on this topic from four aspects.

Regarding cooperation on the digital economy, China has been working to promote the construction of information infrastructure. China proactively participates in cooperation on the digital economy under multilateral frameworks such as the Group of 20 (G20), Asia-Pacific Economic Cooperation (APEC) and BRICS, and contributes to the development of the digital economy globally. Regarding cybersecurity cooperation, China has been working with the international community to increase cooperation in data security and personal information protection and jointly combat cybercrime and cyberterrorism. The National Computer Network Emergency Response Technical Team (CNCERT) has established partnerships with 274 computer emergency response teams (CERTs) from 81 countries and regions. Regarding the governance of cyberspace, China has proactively carried out bilateral and multilateral dialogue and cooperation in cyberspace, and worked to promote the reform and development of the global internet governance system. Global exchange platforms such as the WIC Wuzhen Summit have been developed, and the WIC was established as an international organization in July this year. Here, I would also like to announce that the 2022 WIC Wuzhen Summit will officially kick off on Nov. 9. We look forward to your participation and hope you follow its updates. Regarding promoting inclusive global development, China has been proactively carrying out international cooperation in poverty alleviation through internet access, promoting online cultural exchange and mutual learning among civilizations, and working to provide benefits to people around the world with the achievements in internet development.

At last, about China's vision of the future development of the internet. The white paper illustrated China's proposal to create a closer community with a shared future in cyberspace regarding cyberspace development, governance, security and cooperation.

The 20th CPC National Congress has pointed out the direction for building strength in cyberspace, digital technologies, and international cooperation. Guided by the concept of building a community with a shared future in cyberspace, China will cooperate with the international community to promote the development of an open, inclusive, and vibrant cyberspace that is fairer, more rational, and secure and stable, to ensure that the internet will bring more benefits to people of all countries.

Next, my colleagues and I are very willing to answer your questions.

Xing Huina:

Okay, now you can ask questions. Please identify the media outlet you represent before raising a question. 

CCTV:

As mentioned in the white paper just now, China has been deepening international exchanges and cooperation in cyberspace in recent years, contributing to the building of a community with a shared future in cyberspace. What are the features of international exchanges and cooperation in cyberspace in the new era?

Cao Shumin:

Thanks for your question. I will take this question. When introducing the main contents of the white paper just now, I mentioned that in recent years, China has followed the guidance of the concept of building a community with a shared future in cyberspace and carried out international exchanges and cooperation concerning cyberspace, continuously achieving positive outcomes. To sum up, the international exchanges and cooperation have several features as follows.

First, we have been committed to a people-centered approach. China is the world's largest developing country and the country with the largest number of internet users at 1.05 billion. We have upheld the people-centered development philosophy and worked to promote the development of the internet. We have tried to align its development with the laws of development in the information age and ensure its development more live up to the needs and expectations of the people to make the internet more beneficial to people throughout the world.

Second, we have been committed to openness and cooperation. General Secretary Xi Jinping has stressed that openness is a major driving force for the progress of human civilization and is essential for the development and prosperity of the world. In recent years, we have been committed to openness and cooperation, upheld multilateralism, and actively built bilateral, regional, and international platforms for collaboration. We have promoted pragmatic cooperation with many countries in cybersecurity and IT to the shared expectation of the international community for deepening dialogue and cooperation in this field.

Third, we have been committed to mutual benefit and win-win outcomes. We have been practicing the idea of mutual benefit and win-win outcomes, opposing a zero-sum game and striving to make sure the achievements of internet development and governance are shared by all countries. The outcomes of exchanges and cooperation in cyberspace between China and other countries have been achieved in a host of pragmatic cooperation projects such as bridging the digital divide, facilitating the growth of the digital economy, and promoting poverty reduction, which has enhanced people-to-people connectivity and common development. 

Fourth, we have been committed to equality. It has been China's consistent view that all countries, big or small, strong or weak, rich or poor, are entitled to equal participation in developing a global order and international rules. The future development of cyberspace should be decided by people of all countries, who should work together to create an international environment conducive to development and foster new drivers for global growth. We firmly oppose acts of bullying, the erection of walls and barriers, and any attempts to decouple and disrupt industrial and supply chains. We reject unilateralism and maximum-pressure tactics. We uphold mutual respect, seek common ground while setting aside differences, and advocate the idea that international affairs should be discussed by all involved.

Fifth, we have been committed to maintaining peace and security. We oppose the so-called absolute security for some at the expense of the interests of others and any form of arms race in cyberspace. We support jointly fighting cybercrime and cyberterrorism, oppose network eavesdropping and cyberattacks, and strengthen international cooperation on personal information protection. We have actively carried out dialogue and cooperation in cybersecurity in order to reject the Cold War mentality, uphold peace through collaboration and seek our own security through common security.

Six, we have been committed to promoting fairness and justice. Cyberspace is globally interconnected, so no country can effectively govern it alone. We have been committed to promoting governments, international organizations, enterprises, and think tanks to work together to improve dialogue and consultation mechanisms in cyberspace so that the global internet governance system can become fairer and more rational and reflect the aspirations and interests of the majority of countries in a more balanced way. Thank you.

Phoenix Satellite Television:

At the end of April this year, the U.S. government launched the Declaration for the Future of the Internet. Today, the Chinese government issued the white paper titled "Jointly Build a Community of Shared Future in Cyberspace." What's the relationship between the proposal of the Chinese government and the declaration by the U.S. government? What are the differences? Thank you.

Cao Shuming:

Thank you for your question. This question has attracted much attention from the public. Ms. Qi Xiaoxia, director general of the International Cooperation Bureau of the Cyberspace Administration of China, will answer this question. 

Qi Xiaoxia:

I'm happy to answer the reporter's question from Phoenix Satellite Television. It should be said that the white paper is fundamentally different from the so-called Declaration for the Future of the Internet. As you mentioned, a certain country launched the so-called "Declaration for the Future of the Internet" in April, trying to impose its own standards on others, drawing ideological lines in cyberspace, forming an exclusive clique to instigate division and confrontation, and violating international rules. These acts have seriously broken the solidarity of the big family of the internet and severely affected the stable development of the global internet. 

As you can see, the white paper put forward "China's proposals on creating an even stronger community with a shared future in cyberspace." What we advocate is openness, cooperation, inclusiveness, and mutual learning, and what we uphold is that cyberspace is the shared home of all of humanity and the future of cyberspace should be decided by all countries in the world, rather than by one single country or several countries.

In international cyberspace governance, we champion leveraging the role of the United Nations as the main channel. We also advocate that the international community should commit itself to extensive consultation, joint construction and shared benefits, strengthen cooperation, and jointly formulate international rules in cyberspace. 

We are willing to deepen cooperation with other countries in the world, jointly promote the reform and development of the global internet governance system, and work together to build a stronger community with a shared future in cyberspace. Thank you!

Tianmu News:

I noticed a paragraph on page 27 in the white paper that says, "China actively facilitates the digital industry and industry digitalization and calls for joint efforts to coordinate the transformation towards digitalization and green growth." Please share with us China's specific considerations in this regard. Thank you.

Cao Shumin:

Thank you for your question. Mr. Wang Song will answer it.

Wang Song:

Thank you for your interest in digitalization and green growth. The report to the 20th CPC National Congress proposed "moving faster to boost China's strength in cyberspace and digital development" and called for "accelerating the transition to a model of green development, boosting green and low-carbon industries, and promoting green and low-carbon ways of production and life."

At present, digitalization and green growth are not only important themes for global development but also twins that are interdependent and mutually reinforcing. For one thing, the energy consumption of the digital industry is growing rapidly. For example, the total power consumption of data centers in China currently accounts for about 1.5% of the country's total, posing an urgent need for green transformation and development. For another thing, digital technology has played an increasingly prominent role in driving the green transition of traditional industries. It is predicted that by 2030, various industries can cut 12.1 billion tons of carbon emissions by dint of digital technology.

In recent years, China has organized and implemented the action plan on coordinated transformation towards digitalization and green growth, whose main tasks include three respects. The first is to promote the green and low-carbon development of the digital industry. The second is to accelerate the green transformation of traditional industries enabled by digital technology. The third is to leverage the role of green transition of industries in driving the digital industry. Eighteen key actions have been deployed centering on the tasks in the above-mentioned three respects.

With the joint efforts of various departments and regions, preliminary progress has been made to coordinate transformation towards digitalization and green growth. For example, the current energy consumption per 5G base station has declined by more than 20% compared with that for initial commercial use in 2019, and the average power usage efficiency (PUE) of planned data centers above large scale nationwide has dropped below 1.3. Large domestic digital technology companies have responded to calls nationwide and have taken the lead in formulating low-carbon development plans.

Next, we will further promote the action plan on coordinated transformation towards digitalization and green growth and focus on the following three tasks. The first is to organize and conduct comprehensive pilot programs in this regard and encourage regions with suitable conditions to carry out pilot trials. The second is to promote typical cases and experiences of digital technology enterprises in coordinating transformation towards digitalization and green growth and let these enterprises play an exemplary role. The third is to strengthen relevant international cooperation and promote the expansion of exchanges and sharing of experience under bilateral and multilateral cooperation mechanisms. Thank you.

The Paper:

Since the 18th CPC National Congress, General Secretary Xi Jinping has put forward the concept of building a community with a shared future in cyberspace. Could you talk about your understanding and perception of the concept? Thank you.

Cao Shumin:

Thanks for your question. The concept of building a community with a shared future in cyberspace proposed by General Secretary Xi Jinping is rich in content. I'd like to invite Mr. Yang Shuzhen to answer this question.

Yang Shuzhen:

The question you raised is very important, and I'm happy to take it.

At the second World Internet Conference held in December 2015, President Xi Jinping delivered a keynote speech, and for the first time, clearly put forward the concept of "building a community with a shared future in cyberspace." Since then, he has made in-depth interpretations of the concept on many occasions. This continuously enriched concept has an increasingly bigger influence, which has become a consensus of the international community. By studying and comprehending, I feel that this important concept can be summed up in "four sentences":

First, it is an important thought that keeps up with the changing world. The world is currently undergoing profound changes unseen in a century. On the one hand, the historical trends of peace, development, cooperation, and mutual benefit are unstoppable. On the other hand, as hegemonic, high-handed, and bullying acts have caused serious harm to the world, the international community is facing unprecedented challenges, and the world is once again reaching a crossroads in history. General Secretary Xi Jinping, with insight into the changes in the world, the times, and the history, has clearly put forward the major concept and proposition of building a human community with a shared future. Building a community with a shared future in cyberspace is an important part of building a human community with a shared future and an important part of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, especially the important thought of the general secretary on boosting China's strength in cyberspace. It provides a guideline for the international community to cope with the changes and new challenges and jointly build a community with a shared future in cyberspace. 

Second, it is a strategic goal that responds to the call of the times. At present, the new round of technological revolution represented by IT is changing with each passing day. The internet has turned the world into a "global village," and the international community has increasingly become a community with a shared future where our interests are closely intertwined. With a view of the changes in the information era, General Secretary Xi Jinping clearly put forward the strategic goals of building a community with a shared future in cyberspace where we can jointly advance development, safeguard security, participate in governance, and share the benefits. He called on efforts to build the cyberspace into a community with shared development, security, responsibilities, and interests that benefits all humanity, specifying the strategic goals for building a community with a shared future in cyberspace.

Third, it is the basic principle of solving practical problems. The internet has vigorously promoted the progress of human civilization, but it has also brought a series of new threats and challenges to the sovereignty, security, and development interests of all countries. Cyberspace hegemonism and power politics are emerging. Protectionism and unilateralism are on the rise. Cyber attacks and cyber crimes are becoming severe. Adopting a problem-oriented and systematic approach, General Secretary Xi Jinping clearly put forward "four principles" to promote the reform of the global internet governance system, namely, respecting cyber sovereignty, safeguarding peace and security, promoting openness and cooperation, and building good order, which points out the direction and principles for building a community with a shared future in cyberspace.

Fourth, it is China's proposal to enhance global well-being. The internet is a home shared by all mankind, and the future of cyberspace should be jointly created by all countries in the world. With a view on improving the well-being of all mankind, General Secretary Xi Jinping clearly put forward a "five-point proposal" of building a community with a shared future in cyberspace, namely, speeding up the building of global internet infrastructure and promoting inter-connectivity; building an online platform for cultural exchange and mutual learning; promoting innovative development of the internet economy for common prosperity; maintaining cyber security and promoting orderly development; and building an internet governance system to promote equity and justice. The proposal provides us with a practical path for building a community with a shared future in cyberspace and will surely promote the development of the internet to better benefit the people in China and the rest of the world. Thank you!

Bloomberg News:

I was wondering, has China finished what it set out to do with the overhaul and rectification of the internet and online platforms? Or is there still more work to be done? Thank you. 

Wang Song:

Thank you for your interest in internet platform companies. It is our important responsibility to encourage and support the healthy and sustainable development of internet platform companies. We carry out daily supervision of the behavior of internet platform companies in accordance with laws and regulations. If there is a prominent disorder on the internet, we will also carry out a "Clear and Bright" special campaign to deal with that. For internet platform companies, we generally follow the principle of promoting development and regulating their behaviors at the same time, guiding them with policies and managing them in accordance with the law, and pursuing social benefits and economic returns at the same time, thus creating a favorable environment for the development of internet platform companies. Thank you.

Southern Metropolis Daily:

The white paper mentions that China's internet development and governance practices have made positive contributions to building a community with a shared future in cyberspace and the country has put forward its proposals. Is China promoting a model of internet development and governance by issuing this white paper, "Jointly Build a Community with a Shared Future in Cyberspace"? Thank you.

Cao Shumin:

Thank you for your question. I'll answer it.

Different countries have different national conditions, different political systems, and different cultural backgrounds. We believe that all countries have the right to choose the internet development path that fits their own needs. At the same time, we also notice that people all over the world have the same desire to benefit from the digital age and they all expect to share the benefits of the internet for a better life. This is precisely what governments, international organizations, internet enterprises, technical communities, non-governmental organizations, and individual citizens should strive for.

China has explored experience for building a community with a shared future in cyberspace with its internet development and governance practices, and contributed its wisdom and solutions in this regard. All countries, with various forms of civilization, should and must be able to find their own path for internet development and governance. As a Chinese saying goes, we need to appreciate the beauty of each civilization and show respect for the diversity of civilizations in the world. We strongly support diversified exploration and practice, rather than imposing our own model on others. China is committed to respecting the sovereignty in cyberspace and respecting the rights of all countries to independently choose their own path of cyber development, model of cyber regulation, internet public policies, and their right to equal participation in global cyberspace governance.

That's all for your question. Thank you.

Kyodo News: 

I have two questions. The first one is: In the report to the 20th CPC National Congress, General Secretary Xi Jinping emphasized that China will move faster to boost China's strength in cyberspace. So what will China do in the next five years? And what measures will be taken? My second question is: As China continues to strengthen cyber security in recent years, some foreign companies have expressed worries about restrictions on their work in China. What is China's response to such concerns? Thank you.

Cao Shumin:

Thank you for your questions. You asked two questions. The first one is about building China's strength in cyberspace. We invite Mr. Yang Shuzhen to answer it, and Ms. Qi Xiaoxia will take the second.

Yang Shuzhen:

The 20th CPC National Congress has drawn a blueprint for the future development of the Party and the country. Particularly, based on the development trends of the information age, it has put forward a series of new tasks, new arrangements, and new requirements for boosting China's strength in cyberspace. We must fully implement the guiding principles of the 20th CPC National Congress, follow General Secretary Xi Jinping's requirements of "developing strong technology, content, and talent pool, building a solid base, and having a better say in related international affairs," and make efforts to build China's strength in cyberspace, so as to provide strong services, support, and guarantees for building a modern socialist country in all respects. Specifically, our future work will include the following seven aspects.

First, we will better develop online content to shape a new pattern of public opinion. We will give full play to the communication advantage of the internet, promote the construction of omnimedia communication system, uphold fundamental principles and break new ground in the publicity work concerning major online topics, strive to create high-quality, uplifting content, and comprehensively improve the accuracy, effectiveness, and attractiveness of international communication online, so as to steadily amplify mainstream online public opinion and the voice of China.

Second, we will promote the formation of a sound cyber ecosystem by improving the comprehensive internet governance system. On the basis of the governance system to be completed by this year, we will strive to build a scientific, efficient, and orderly internet governance pattern, promote cultural-ethical advancement on the internet, advance legislation, administration of justice, law enforcement, and law popularization with regard to the internet. We will intensify efforts to strengthen governance at the source of the cyber ecosystem, enhance governance in a systematic and law-based manner, and press ahead with "Operation Qinglang" so as to build a cleaner cyberspace.

Third, we will accelerate the construction of "digital China" to help realize Chinese modernization. We will give full play to the leading role of the overall layout of "digital China," accelerate the development of new-generation information infrastructure, promote the integrated development of the digital economy and the real economy, build internationally competitive digital industrial clusters, and accelerate the development of a digital government, a digital society, and a digital countryside. We will carry out the action plan for coordinated transformation and development of digitalization and greening and the action plan for enhancing digital literacy and skills of the entire population to promote new development with new growth drivers.

Fourth, we will focus on making breakthroughs in core technologies in the information sector to achieve greater self-reliance and strength in cutting-edge technologies. We will give full play to the new system for mobilizing resources nationwide and the leading role of major projects, accelerate original and pioneering sci-tech breakthroughs, strengthen basic research, improve incentive mechanisms, and facilitate the formation of an innovation ecosystem and the independent capacity of industries.

Fifth, we will maintain cybersecurity and data security to promote the modernization of the national security system and capabilities. We will comprehensively strengthen supporting systems and capacity building to ensure cybersecurity and data security, enhance security and protection of critical information infrastructure, strengthen the protection of personal information and important data, and effectively safeguard national cybersecurity and the vital interests of the people.

Sixth, we will strive to build a community with a shared future in cyberspace to promote the building of a community with a shared future for mankind. We will conduct in-depth exchanges and cooperation in cyberspace and actively participate in cyberspace governance in a bid to deliver more tangible benefits brought by the development of the internet to people all over the world.

Seventh, we will step up efforts to cultivate a team of internationally competitive professionals in cybersecurity and IT to advance the country's workforce development strategy. We will innovate the mechanism for cultivating talents in this realm to produce more science strategists, first-class scientists and innovation teams, young scientists, and outstanding engineers. We will also build a new type of think tanks and cultivate a strong team of officials to provide strong intellectual and personnel support to build up the country's strength in such fields. Thank you.

Qi Xiaoxia:

I will answer the second question raised by the reporter from Kyodo News. This question is about foreign companies' concerns about restrictions on operating in China. My answer is clear: such concern is absolutely unnecessary. As the 20th National Congress of the Communist Party of China has underscored, China remains committed to the fundamental national policy of opening to the outside world. You may have noticed that, in his speech at the opening ceremony of the fifth China International Import Expo on Nov. 4, President Xi Jinping pointed out that China "will work with all countries and all parties to share the opportunities in its vast market," "will work with all countries and all parties to share the opportunities from its institutional opening up," and "will work with all countries and all parties to share the opportunities from deepened international cooperation." We can see from this that China's door to the world will only open wider and wider. 

According to data from Chinese competent authorities, more than a million foreign companies were registered in China, of which Japanese-funded enterprises account for a large proportion. This shows that foreign companies are very confident in China's business environment. The Chinese government has always been committed to fostering a market-oriented, law-based, and internationalized business environment, encouraging enterprises to operate and develop in accordance with laws and regulations and treating Chinese and foreign-funded enterprises as equals. Thanks.

Beijing Youth Daily:

My questions are about international communications. The report to the 20th CPC National Congress says we will strengthen our international communications capabilities and make our communications more effective. What progress has been made in international communications in cyberspace? What steps will be taken to tell China's stories well and contribute to building a community with a shared future in cyberspace? Thank you.

Cao Shumin:

Thank you for your questions. To present a credible, appealing and respectable China is a long-term objective of strengthening international communications capabilities. Let's invite Mr. Chen Renze to answer the questions.

Chen Renze:

Thanks to the journalist with Beijing Youth Daily. Since the 18th CPC National Congress, General Secretary Xi Jinping personally planned, deployed, and promoted work on international communications and elaborated on a series of major theoretical and practical questions on strengthening international communications capabilities, pointing out a clear direction and offering fundamental guidelines for us. In accordance with General Secretary Xi Jinping's important instructions and the decisions of the CPC Central Committee, we have worked with local authorities and other departments to make innovations on the basis of what has worked in the past and extend the reach and influence of international communications in cyberspace. Positive progress has been achieved in this regard.

First, giving theoretical guidance and fully demonstrating the essence of the Chinese path. Focusing on major events and occasions, we leveraged the advantages of internet-based communication, innovated discourse, and strengthened presentation across all forms of media and interactive communication to interpret Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era from multi-dimensional perspectives. This was done to help more foreign audiences understand the power of truth and the global significance of the latest achievement of adapting Marxism to the Chinese context and the needs of our times.

Second, actively showcasing our image and enhancing the appeal of Chinese governance philosophy. We organized international internet communication activities such as "A Date with China" and "DaKa China" on major themes, including the 20th CPC National Congress, the Party's centenary, and the Beijing Winter Olympics. These activities showcased China's image as a country of diversity that is marching forward and gave the international community a hands-on experience on the three fundamental questions of why the CPC works in China, why the Marxism works in China and why the socialism with Chinese characteristics works in China.

Third, creating a positive impression and promoting the defining symbols of Chinese culture. By using modern, human-interest, international, and vibrant means of online communications, we promoted fine culture featuring Chinese characteristics, highlighting China's ethos, and embodying Chinese wisdom. These were delivered a group of online works which demonstrate Chinese aesthetics, modern concepts, and the shared values of humanity to better present Chinese culture to the world.

Fourth, increasing cohesion and encouraging more people to tell China's stories. With the internet as the medium, we built platforms for understanding China through programs such as "Why Red Star Shines in China" and "I am in China in the New Era." More and more foreign political leaders, experts, journalists, and overseas Chinese shared their interactions and friendship with China online, telling China's stories and promoting Chinese culture. China's image as a country that is credible, appealing and respectable has become more vivid and multi-dimensional. 

For the next step, we will focus on the important arrangements made in the report to the 20th CPC National Congress, prioritize studying, publicize and implement the guiding principles of the congress, follow the laws of international communications in cyberspace, develop a global perspective, keep in mind key tasks, build our ability, comprehensively improve the capacities, level and effectiveness of international communications in cyberspace, and better tell stories of China and the CPC to make China's voice heard by more people and present a true, multi-dimensional, and panoramic view of China. Thanks.

CRNTT:

What measures have been adopted in China to safeguard cybersecurity? Are there any practices or experiences in this regard that you'd like to share with other countries? Thank you.

Cao Shumin:

Thank you for your questions. Cybersecurity is an issue of great concern to everyone. Sustainable development is impossible without cybersecurity. I'd like to invite Ms. Sun to answer this question.

Sun Weimin:

Thank you for your questions and your concern about issues related to cybersecurity.

Since the 18th CPC National Congress, the CPC Central Committee with Comrade Xi Jinping at its core has attached great importance to cybersecurity and made a series of important instructions, charting the course and providing fundamental guidelines for the work on cybersecurity. In recent years, local authorities and government departments across the country have thoroughly studied and implemented General Secretary Xi Jinping's important thoughts on building China's strength in cyberspace. Remarkable progress has been made in its efforts to ensure cybersecurity, which can be seen in the following five aspects:

First, a policy and legal framework for cybersecurity have taken shape. A number of laws and policies have been formulated and put in place, including the Cybersecurity Law, Data Security Law, Personal Information Protection Law, Cybersecurity Review Measures, and Security Assessment Methods for Cloud Computing Services. Moreover, over 300 national standards for related realms have been issued. These laws and policies, therefore, have served as pillars of the legal and policy framework for cybersecurity.

Second, the working system for cybersecurity has been steadily improving across the country. We issued the emergency response plan for internet security incidents, establishing and improving a national working system for cybersecurity emergency response coordination and notification so as to carry out supervision and early warning in a timely manner. In this way, we have established a coordinated working system nationwide. 

Third, the protection system for critical information infrastructure has witnessed remarkable progress, with its capabilities continuing to improve. We have promulgated laws and regulations, such as the Regulations on the Security and Protection of Critical Information Infrastructure, to provide a solid legal foundation for the security and protection system of critical information infrastructure. Thanks to the coordination of the Office of the Central Cyberspace Affairs Commission and the joint effort of other government departments, the protection of the critical information infrastructure is steadily improving. 

Fourth, education, technologies and industries concerning cybersecurity have witnessed integrated development. We have established the first-level discipline of cyberspace security, and launched a demonstration project for the construction of first-class schools and colleges of cyber science. At present, more than 60 universities in China have set up schools and colleges of cyber science, with over 20,000 graduates majoring in cybersecurity every year. The country has set up the national cybersecurity talent and innovation base and is building five national-level pilot areas for integrated development of education, technology, and industry in the field of cybersecurity.

Fifth, the understanding of "a secure cyberspace environment serves and relies on the people" has been growing in popularity. We have held China Cybersecurity Week – an activity to raise people's awareness of cybersecurity – annually for nine years, disseminating cybersecurity information in a regular manner. We have launched special campaigns against the underground industry and cybercrimes like hidden cameras, the sale of personal information, infringing on people's private information, as well as telecom and online fraud. 

The spirit of the 20th CPC National Congress is being studied and implemented throughout the country. The 20th CPC National Congress has charted the course for the future development of China's cybersecurity and IT undertaking, injecting strong impetus into international cooperation in this field. We will work together with all countries and jointly build a community with a shared future in cyberspace. Thank you. 

Red Star News:

The white paper, in several places, notes that Chinese enterprises have made a great effort to tap into oversea markets in terms of information infrastructure construction and e-commerce development. They have made great contributions to global internet development. However, some Chinese enterprises, such as Huawei, have come across restrictions in some countries. What's your comment on this? Thank you. 

Cao Shumin:

Thank you for your question. The rapid development of cyberspace and IT across the world is largely due to globalization. However, it is true that some anti-globalization trends are on the rise. I'd like to invite Ms. Qi Xiaoxia to answer this question.

Qi Xiaoxia:

This is a question of public concern and also a question that we should pay attention to. As China's internet industry grows rapidly, Chinese enterprises have engaged in the international market, conducted international cooperation on research and development, and provided a great number of safe, reliable, and quality products and services at a reasonable price, enjoying great popularity worldwide. They have taken an active role in fulfilling social responsibilities, creating plenty of job opportunities for the countries and regions where they are based. Due to a lack of space, the white paper only gives a few examples. 

Some Chinese companies, like Huawei, encountered difficulties in pursuing overseas business development. The reasons behind it are clear. Certain countries wantonly imposed export controls on China under the pretext of "national security" and deliberately blocked and suppressed Chinese companies, which infringed upon their legitimate rights and interests and severely disrupted the stability of global industrial and supply chains.

The white paper made it clear that the Chinese government opposes the politicization of technical issues and the containment of other countries' enterprises by abusing state power and violating market principles and trading rules.

We can see that under the current situation, global economic recovery faces multiple challenges and risks. What the international community urgently needs is unity, not division. We should tide over difficulties together instead of provoking confrontation. That is, those who call for decoupling, sever supply chains, and stoke division and confrontation, will only hurt themselves and other countries. Win-win cooperation is the only right path. Thank you. 

CNR:

The white paper says that the international organization of the World Internet Conference was inaugurated in Beijing in July 2022. You just mentioned that the World Internet Conference Wuzhen Summit would be held soon. What are the Chinese government's expectations for the future development of the international organization of the World Internet Conference?

Cao Shumin:

Thank you for your question. I will answer your question. The World Internet Conference has been held eight times. Based on the Wuzhen Summit, the international organization of the World Internet Conference was inaugurated this July. At the inaugural ceremony of the organization, Chinese President Xi Jinping sent a congratulatory letter, pointing out that the establishment of the organization is an important move echoing the informatization trend of the times, and it will deepen international exchanges and cooperation in cyberspace. He called for efforts to develop the World Internet Conference in line with forward-looking plans and high standards, to promote joint consultation through dialogues and exchanges, and to ensure benefits are shared by all through practical cooperation so as to contribute wisdom and strength to the global internet development and governance. The World Internet Conference is an open platform, and China stands ready to work with the international community to promote the development of the international organization.

We have the following expectations for the future development of the international organization of the World Internet Conference. 

First, in terms of enhancing consensus, we will focus on the new challenges and problems faced by cyberspace, uphold openness and inclusiveness, and support the international community to better handle disputes and reach more consensus.

Second, in terms of the digital economy, we need to leverage its role to advance socio-economic development. We hope that the digital economy can become a major engine in driving global digitalization, empowering its transformation. We also hope that the international organization can make contributions to the global digital economy.

Third, in terms of digital technology innovations, we will strengthen cooperation with the international community, deliver more major outcomes for innovation, and boost the advances in technology. The latest technological innovations are released at the Wuzhen Summit every year.

Fourth, in terms of cultural exchanges, we will encourage cooperation with internet media, advance the development of internet culture, promote mutual learning among civilizations, raise the public's digital literacy, and push forward the sound development of online cultural industries.

Fifth, in terms of setting rules, we will continue our efforts to advance the progress of global internet governance and encourage corporate members, research institutions, and universities worldwide to conduct discussions and exchanges on governance rules and technical standards, among other areas.

Sixth, in terms of exchanges and cooperation, we will build better platforms for exchanges and cooperation between governments, international organizations, multinational enterprises, technical groups, and experts and scholars. The above are our expectations. Thank you.

Xing Huina: 

Today's press conference is hereby concluded. Thank you to our speakers and all friends from the media. Goodbye.

Translated and edited by Gong Yingchun, He Shan, Wang Yiming, Yuan Fang, Xu Xiaoxuan, Zhang Rui, Cui Can, Zhang Liying, Li Huiru, Qin Qi, Liu Qiang, Yan Xiaoqing, Wang Wei, He Shan, Xu Kailin, Wang Qian, Zhu Bochen, David Ball, Tom Arnsten, and Jay Birbeck. In case of any discrepancy between the English and Chinese texts, the Chinese version is deemed to prevail.

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Read in Chinese

Speaker:

Mr. Ran Chengqi, director general of the China Satellite Navigation Office and spokesperson of the BeiDou Navigation Satellite System

Chairperson:

Ms. Shou Xiaoli, deputy director general of the Press Bureau of the State Council Information Office (SCIO) and spokesperson of the SCIO

Date:

Nov. 4, 2022

Shou Xiaoli:

Ladies and gentlemen, good morning. Welcome to this press conference held by the State Council Information Office (SCIO). Today, the SCIO published a white paper titled "China's BeiDou Navigation Satellite System in the New Era," and organized this press conference to introduce and interpret its main content. The white paper fully implements Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, introduces China's policies to develop the BeiDou Navigation Satellite System (BDS) in the new era, and reviews the progress in BDS construction and application. According to the white paper, China has carried out active international cooperation on BDS and advanced its international applications so that the system can better serve the world and benefit humanity. The white paper points out that China will work with all other countries to promote the development of navigation satellite systems and contribute to building a human community with a shared future.

At around 12,000 Chinese characters, the white paper consists of preamble, main body and conclusion. The main body is divided into six parts: "BeiDou in the New Era," "A World-Class Navigation Satellite System," "Improving BDS Operation Management," "Promoting Sustainable Development of the BDS Applications Industry," "Upgrading BDS Governance" and "Contributing to Building a Human Community with a Shared Future." The white paper is published in eight languages — Chinese, English, French, Russian, German, Spanish, Arabic and Japanese — by the People's Publishing House and the Foreign Languages Press. It is available at Xinhua Bookstore outlets across the country. To help you gain an accurate and deep understanding of the white paper, we have invited Mr. Ran Chengqi, director general of the China Satellite Navigation Office and spokesperson of the BeiDou Navigation Satellite System, to brief you on relevant information and then take your questions.

Now, I'll give the floor to Mr. Ran for his introduction.

Ran Chengqi:

Ladies and gentlemen, it's my pleasure to meet with friends from the media again. Thank you for your interest in and support for BDS. On July 31, 2020, General Secretary Xi Jinping announced to the world that BDS-3 was officially commissioned, marking the successful conclusion of the three-step BDS strategy and ushering in a new stage for the system's high-quality development.

As all Party members and all the Chinese people are earnestly studying the guiding principles of the 20th National Congress of the Communist Party of China (CPC), here we are issuing the white paper "China's BeiDou Navigation Satellite System in the New Era." The white paper reviews the development course of BDS and shows that in the new era, China has improved the BDS service capacity, achieved new progress in related industries, increased openness for relevant cooperation, and embarked on a new journey of BDS development.

First, China's BDS in the new era is a world-class navigation satellite system.

Based on its national conditions, China has independently developed BDS. We have independently developed core technologies, laid out an innovative system configuration, and offered quality and diverse services. Since BDS-3 was formally commissioned, the system has maintained uninterrupted, stable and reliable operation, and provided world-class services.

The 30 in-orbit satellites of BDS-3 have maintained a good operation status. Millions of their components in more than 300 categories, all produced by China, demonstrate excellent performance. The system's measurement positioning accuracy worldwide is better than five meters. Its accuracy is higher in the Asia-Pacific region and its service performance is better than all design indicators.

The system offers six high-quality specialized services: international search and rescue, global short message communication, regional short message communication, satellite-based augmentation, ground-based augmentation, and precise point positioning. We are now able to provide a wide range of services and are even leading the way in some areas.

China has achieved intelligent operation and maintenance for BDS, upgraded the software of in-orbit satellites, conducted global real-time monitoring and assessment of the system, and released the latest information. Since the system was commissioned, China has ensured its continuous and stable operation and improved its performance. We have embarked on a sustainable development path for BDS featuring high quality and efficiency, and low cost.

Second, large-scale application of China's BDS in the new era has entered a fast track of development.

China has achieved sustainable development of the BDS applications industry. The country has formulated industrial development strategies and included BDS industrial development into its 14th Five-Year Plan (2021-25). The system has been deeply integrated into infrastructure, empowered various industries and sectors, and served everyday life, delivering considerable economic and social benefits. In 2021, the total output of China's satellite navigation and location-based service industry reached 470 billion yuan, with a compound annual growth rate of over 20%.

China has forged secure and stable industrial and supply chains and reinforced the foundation of the BDS industry. We have built a complete industrial chain of chips, modules, antennas and boards, independently developed software and algorithms, and established a national product testing and certification system. Shipments of domestically manufactured chips exceeded 100 million, and foreign-manufactured chips of the same type are compatible with the system, thus ensuring the sound growth of the industry.

As BDS has been widely used in various industries and fields, its in-depth applications have grown. As of June, over 8 million BDS terminals had been installed on transport vehicles. Approximately more than 1.3 million terminals were used in the farming, forestry, livestock, and fishing industries and more than 1.8 million terminals adopted by public security organs. Large-scale BDS applications have been advanced in communication and timing services, meteorological monitoring, emergency response and disaster mitigation, and urban management. 

BDS has a wide range of applications in people's daily lives and they have easy access to its specialized services. BDS is becoming a standard configuration for mass-consumption products such as smartphones and wearable devices. In the first half of this year, among all types of smartphones that applied for network access in China, 128 supported the BDS-based positioning function. More than 130 million smartphones supporting BDS services were shipped, accounting for over 98% of the country's total. The BDS positioning service is used more than 100 billion times on average every day for map navigation on mobile phones. In particular, the public's mobile phones have been fitted with high-precision positioning services. Lane-level navigation has been implemented in eight cities, including Shenzhen, Chongqing, and Tianjin. The first mobile phone in the world that supports BDS-3 regional short message communication services has been officially released. Users can send short messages through BDS without changing SIM cards or phone numbers or using extra equipment.

Third, China's BDS in the new era contributes to building a global community of shared future

China has been committed to the principles of openness and integration and advancing the internationalization of BDS. It advocates the compatibility and interoperability of different satellite navigation systems, promotes the ratification of BDS by international standards, and expands its international applications to serve the world and benefit humanity.

Statements on signal interoperability with GPS and GLONASS have been signed and cooperative talks with Galileo system have been held. China has promoted the compatibility and interoperability of diverse systems under the framework of the United Nations. Doing so ensures a user-friendly BDS with the compatibility of various systems to jointly provide high-quality, diverse, secure and reliable services for global users.

Bilateral cooperation has been expanded and deepened. Cooperative mechanisms have been built with regional organizations and countries in Asia, Africa and Latin America. Over 50 outcome documents have been signed, including cooperation agreements on satellite navigation, memorandums of understanding, and cooperation roadmaps.

Multilateral cooperation has been strengthened. China-ASEAN, China-Arab States, and China-Africa BDS cooperation forums have been launched and the action plan for satellite navigation cooperation has been carried out. China has held the annual China Satellite Navigation Conference and Annual Conference of China GNSS and LBS every year and initiated the International Summit on BDS Applications. More than 100 overseas students from about 20 countries have obtained professional master's and doctorate degrees in China. More than 1,000 people from over 50 countries have participated in special training on satellite navigation.

China has been promoting BDS to be ratified by international civil aviation, maritime, mobile communications and search and rescue standards. BDS products have been applied in more than half of the countries and regions in the world. A greater variety of products have been exported and the application fields continue to be expanded.

In addition, this edition of the whitepaper has also drawn the blueprint for developing BDS by 2035 for the first time. China will develop a new generation of BDS with more advanced technology, powerful functions and better services. The goal is to create a more extensive, more integrated, and more intelligent comprehensive system that provides navigation, positioning and timing services, laying a solid foundation of spatiotemporal infrastructure for China's modernization.

Exploring the vast cosmos has been the dream of the Chinese nation for millennia. From observing Beidou (Chinese pinyin for the Big Dipper) to developing and using BDS, from gazing at the stars to utilizing space, BDS in the new era will continue to advance human progress in exploring the universe and make an even more significant contribution to achieving the great rejuvenation of the Chinese nation and building a global community of shared future and a better world.

That's all for my introduction. Thank you.

Shou Xiaoli:

Thank you for your introduction, Mr. Ran. Let's move on to the question-and-answer session. Please identify the media outlet you represent before asking a question. 

China News Service:

Mr. Ran, you published the first whitepaper on BDS six years ago. You have now published another whitepaper on BDS. How have things changed and progressed in the second white paper? Thank you.

Ran Chengqi:

Thank you. The first edition of the white paper was published on June 16, 2016. At that time, BDS-3 was in rapid development. Six years later, we published the white paper on BDS again at a time when BDS-3 had been completed and the three-step BDS strategy had been fully concluded. More importantly, the white paper on BDS in the new era aims to present the progress of BDS and China's achievements and vision in developing BDS. It also aims to share our ideas and experience. Both white papers were developed alongside national development in the new era and aim to serve national rejuvenation.

Today, we release this white paper to update to the public about the latest overall situation of the commissioned BDS. First, BDS-3, the configuration that covers the entire globe, has developed into a world-class navigation satellite system featuring innovative designs in constellation configuration, technical system, services and function. Its technical system, signal design, and service functions are the most advanced and powerful in the world. Second, BDS in the new era can provide a wide range of quality services and conduct real-time global monitoring on a regular basis. The promised positional accuracy of BDS is 10 meters. But we have managed to improve it to within 5 meters. In some areas, it could be 2 to 3 meters. The timing accuracy we promised is 20 nanoseconds, and now we achieved 10. Third, BDS in the new era is under ever-improving management. I mentioned just now that the top priority is to ensure an around-the-clock stable operation of BDS. Its system performance has been constantly improved during this process. Disclosing relevant information, we have also worked to ensure that BDS remains open to the whole world. Fourth, BDS in the new era has deeply integrated into the country's overall economic development and the world's economic domain, injecting strong momentum to growth and benefiting the world and humanity. 

Two of the most important parts in "China's BeiDou Navigation Satellite System in the New Era" highlight that BDS has entered a new era and its governance should be further modernized. We could interpret these two points from the following perspectives.

First, the three-step BDS strategy, particularly the complete construction of BDS, demonstrates the BeiDou Spirit of independent innovation, openness and inclusiveness, unity of purpose, and pursuit of excellence. It is a telling example of China's national spirit centered on patriotism and defined by reform and innovation in the new era. Independent innovation is the core competitive advantage. There would be no such top-class global navigation satellite system if we hadn't kept innovating on our own strength since the beginning of the endeavor. By embracing openness and inclusiveness, we have stayed true to our original aspiration of building a BDS for China and the world. Unity of purpose is the code to the success of BDS. It is an institutional advantage of socialism with Chinese characteristics to pool resources for major endeavors and forge ahead in unity. The constant pursuit of excellence is always on our agenda. We have worked hard to catch up and even harder to surpass and lead. That's how we turned BDS into one of the best navigation satellite systems in the world. 

Second, the vision for BDS is fully elaborated. We have built a new generation of BDS that is more advanced, powerful, and capable of providing much better services than before. Next, we will construct an integrated space-time system featuring a more ubiquitous network, deeper integration, and greater intelligence, which will help improve people's well-being and promote the development and progress of humanity. In simple terms, in spite of the fact that BDS is already quite good, we plan to develop a space-time system centering around it, which boasts unified standards, seamless coverage, ensured security and reliability, high efficiency, and great convenience and diversity. 

Third, we demonstrate to the public the modernized satellite navigation governance. We need to balance considerations and seek development. We will coordinate the domestic rule of law with foreign laws, accelerate the formulation of related regulations, participate in the global governance of satellite navigation, and ensure the standardized and sustainable development of BDS. 

Fourth, BDS specialized services are publicized. It can provide seven types of services, including positioning and six other distinctive services. It is worth mentioning that the system's high-accuracy service and short message communication service are dashing into our lives and displaying the application strength of BDS. I may offer you more information on it later. 

That's all I have to say. Thank you.

China Daily:

I have two questions. Many map software operators have adopted BDS as their preferred positioning and navigation service option. Can you illustrate some other scenarios involving such high-accuracy applications in our daily life? Moreover, BDS officially launched a trial application for lane-level navigation recently. What do you think of its prospects? Thank you. 

Ran Chengqi:

Thanks for your question. Just now, I talked about the application of BeiDou's high-precision positioning services. BDS has already provided positioning accuracy at 5 meters and above. However, with economic and social development, the positioning accuracy of 5 meters can no longer meet the needs of users, as the demand for accuracy in socioeconomic development is getting higher and higher. For example, there is a higher demand for accuracy in self-driving technologies, ride-hailing services, deformation monitoring, mudslide monitoring, precision agriculture, and other fields. What shall we do? We have innovatively proposed to build a ground-based augmentation system and achieve higher accuracy through matching and integrating the system with BDS across the country.

Now a nationwide network of BDS ground-based augmentation has been built to provide real-time meter-level, decimeter-level, centimeter-level, and post-processing millimeter-level high-precision positioning services for industrial users and the general public. For ground-based augmentation service, its real-time positioning accuracy can reach 2 centimeters horizontally and 5 centimeters vertically. The post-processing accuracy can reach 2 millimeters horizontally and 5 millimeters vertically. Such high-precision positioning services will lead to more diverse applications and services. For example, we have expanded application scenarios to precision agriculture, deformation monitoring, autonomous driving, electric power inspection, smart ports, and bike sharing.

Let me give you a few examples. At present, this network has provided BDS accelerated positioning and BDS high-precision services for more than 1.5 billion users in more than 230 countries and regions, with services delivered 2 trillion times in total, equivalent to nearly 3 billion on average per day. At present, BDS has provided high-precision positioning services for more than 20 million mobile phones in the country. You also mentioned lane-level navigation just now. In this regard, we have applied high-precision services to people's daily driving and vehicle navigation in a pilot program. It has been carried out in eight cities in China, including Shenzhen, Guangzhou, Dongguan, Chengdu, Chongqing, Hangzhou, Suzhou, and Tianjin. Going forward, we will further expand the program nationwide.

At present, BDS also provides high-precision services for a total of 1.1 million shared bicycles in China and 200,000 electronic fences for shared bike parking in 12 cities across the country. Haphazard parking of shared bicycles, a problem plaguing the city, has been tackled by BDS high-precision services. I am also a user of shared bicycles. If the bicycle is not parked in the designated zone, the rider will not be able to lock the bike. Through this technical method, relevant departments can adjust guidelines for high-precision application scenarios.

At the same time, this network also provides high-precision positioning services for 21 models of smart cars in China, with a mileage of over 2.5 billion kilometers, and for a total of 50,000 industrial drones of domestic drone companies. All of this shows that BDS high-precision applications point to the future of China's satellite navigation industry and has a broad market. We also look forward to seeing more uses of BDS high-precision services in all walks of life. Thank you.

CCTV:

Mr. Ran mentioned that since the official commissioning of BDS-3 in 2020, the work focus has shifted from BDS construction to BDS operation management. BDS has been operating stably during the past two years, so what results have been achieved? What deficiencies need to be improved? Thank you.

Ran Chengqi:

Thanks for your questions. On July 31, 2020, General Secretary Xi Jinping announced that BDS-3 was formally commissioned, and emphasized to us that the system must be easier to use and more stable in operation. All services are built on the premise that the system is more stable and reliable. If not, competing in the market and providing services to the general public would be difficult. Therefore, operational stability has been considered a top priority since BDS-3 was completed. We have pooled relevant technical resources and teams at home, and unswervingly pursued stable operation and performance improvement.

I have an example. The technical standards of BDS availability we designed in the first place was 99%, which meant that 1% of the accuracy was allowed to exceed standards. Satellite navigation systems all over the world are using 99% availability standards, and the time when 1% of the accuracy exceeds the standards is about 86.4 hours per year. We have increased the availability standards from 99% to 99.9% through various parties' technical and management measures. Although it is only a 0.9% increase, which seems like a small step, it is a real giant stride. Through these methods, we have decreased the time length of BDS accuracy that exceeds the standards from 86.4 hours to 8.64 hours. Of course, 100% availability is guaranteed in the actual work. From 99% to 99.9% and then to 100%, this is the overall performance of BDS. We have realized round-the-clock services and no time period affects the use of the system, and we have made the impossible possible thanks to the joint effort of many scientific researchers. We have also adopted a series of advanced and innovative means. For example, in BDS operation, we carry out early warning and prediction or real-time monitoring to predict the situation of the sensitive single-machine systems or components on the satellite, and to make judgments based on the data of satellite operation. We also have a slogan called "spot problems before users do, identify signs of problems before they appear, and solve problems before they cause any impact," so we ensure that proactive measures are rolled out to eliminate hidden problems, give early warnings, and release information to users in a timely manner. We have made it so that from the beginning of BDS construction to the present, the system ensures stable operation, and offers uninterrupted services. We will continue to uphold this standard in the future to ensure BDS's continuous and stable operation. Thank you.

Hong Kong Economic Herald:

We have learned that in the future, in terms of internationalization, BDS will continue to go global, and provide more products and services for overseas markets under the Belt and Road Initiative. Can you give a detailed introduction to the achievements of international cooperation regarding BDS? What are the plans for the next step? Thank you.

Ran Chengqi:

BDS development has been designed in such a way to ensure integration of construction, application and international cooperation since the very beginning. We always prioritize BDS going global and providing services worldwide, and pursue openness and cooperation for its development. We have advanced international cooperation concerning BDS-1, BDS-2, and BDS-3. We fully participate in international satellite navigation affairs. There are several aspects.

First, we have participated in the activities of the United Nations' International Committee on Global Navigation Satellite Systems, or ICG. As an original member, China has made its contributions to the ICG in a timely fashion, which were highly appraised by the UN and the UN Office for Outer Space Affairs (UNOOSA). China's BDS is a responsible system that leads the development of global satellite navigation systems. We have participated in previous satellite navigation work conferences and actively assumed responsibilities for BDS' part in relevant activities of UNOOSA. We have undertaken research on related topics, and participated in the forums of international organizations, in order to promote BDS to provide better services for all mankind. Among them is an organization for the application of satellite navigation systems for developing nations. China has also publicly advocated for it and offered help.

Second, we have actively conducted bilateral talks on cooperation. Above all, we have established specialized cooperation channels with major global navigation systems, such as the United States' Global Positioning System (GPS), Russia's GLONASS system, and Europe's Galileo system, and achieved sound progress. We have jointly promoted the application of global satellite navigation. We have signed the joint statements on compatibility and interoperability with the GPS system and the GLONASS system, and conducted frequency coordination with the Galileo system. In addition, we have conducted application cooperation with countries along the Belt & Road, including both bilateral cooperation and multilateral cooperation. For example, we have participated in and successfully held three sessions of China-Arab States BDS Cooperation Forum, two sessions of China-Central Asia BDS Cooperation Forum, and the First China-Africa BDS Cooperation Forum. We have jointly promoted the application of satellite navigation and BDS by issuing forum statements, action plans, and application scenarios. We have established close ties with countries in Central Asia and Africa, and regional organizations such as the League of Arab States and the Association of Southeast Asian Nations, and conducted in-depth cooperation in testing and evaluation, joint application, education and training, and technical cooperation. It's fair to say that the application of BDS has attracted massive attention and expectations from the world. A Chinese delegation recently attended the meeting of the International Committee on Global Navigation Satellite Systems, which was held in Abu Dhabi in the United Arab Emirates, and has received proposals from many countries and organizations for enhanced cooperation with BDS. They praised BDS as a useful system. We are particularly delighted to promote systems, products, applications, and concepts from China to the world.

Third, we have vigorously participated in multilateral organizations, including both international organizations and standard organizations, and accelerated the application of BDS in the fields of civil aviation, maritime, mobile communication, and international search and rescue. China's BDS has passed all 189 satellite navigation standards listed by the International Civil Aviation Organization (ICAO). We will fully join ICAO and further promote the application of BDS in the field of international civil aviation under the framework of ICAO. Since BDS-1, we have promoted ratification of BDS by the 3rd Generation Partnership Project (3GPP). Therefore, most smartphones we use today are equipped with BDS. We joined the International Maritime Organization in 2014 and other international search and rescue organizations. In light of the special contributions of BDS short message communication service, we have put forward new suggestions to international search and rescue organizations. When people encounter dangers at sea, they can apply for help to the search and rescue organizations. But the previous international rescue signal was one-way, so it was unknown to the caller whether the distress signal was received by search and rescue organizations. BDS ingeniously developed two-way signals to notify the caller that the distress signal has gotten a response, which would be a tremendous mental support for the caller. That is a great contribution from BDS to the international search and rescue efforts. Those BDS applications have been widely recognized among the public. Additionally, after the application of many products and technologies, as part of our efforts to help people to better understand BDS, we have promoted exchange activities, inviting foreign students to come to China to learn and receive training about our technologies and products so as to make people have a better understanding of China's BDS and its applications. Thank you.

Southern Daily:

With the BeiDou-3 global navigation satellite system now operational, what is the current operating status of its satellites? Are there any new plans for further satellite launches to expand the existing BeiDou navigation constellation? Thank you.

Ran Chengqi:

As of now, we have a total of 45 satellites in orbit to provide services, including the BeiDou-3 satellites in orbit and the original BeiDou-2 satellites, which have been in service for an extended period of time, so the system has been functioning very well. Even in such a case, we have to continue to ensure stable operation and make performance improvements to the system. Based on that, we will make efficient use of the satellites in orbit and coordinate with ground systems. At the same time, we will actively promote the construction of a backup satellite system to further ensure the reliability of the system. According to our schedule, we have arranged the production and development of a backup satellite system, including three to five satellites, to be launched next year. We will further strengthen the construction of the constellation to ensure the stable operation of the system. As a major country, China will deliver on our promise of providing world-class services to the rest of the world. 

On this basis, we will further develop the next-generation BDS. We haven't given it a name yet, but it will likely be Beidou-4. It should be better than Beidou-3, with enhanced system performance. At the same time, we need to further integrate it with emerging technologies, such as mobile communications, low earth orbit communications, traditional inertial navigation, and so on. The technologies should be deeply integrated. The next generation will be a more ubiquitous, more intelligent, and more integrated. You may feel the three "mores" are very broad and vague, but in fact, to put it simply, BDS is still the core, and we will incorporate all the emerging technologies related to space-time information into this system, developing it synchronously at a faster speed. Our projected goal is to fully build this space-time system by 2035. By then, we hope that Beidou, China's time-space system, will be everywhere, including underwater, on the ground, indoors, in the air, in deep space, or even in distant outer space. Simply put, Beidou will provide you with safe and reliable space-time technology anywhere anytime. This is our overall consideration for development. Thank you.

Cover News:

Mr. Ran, you just introduced that the Beidou's goal is to build a more ubiquitous, integrated, and intelligent space-time system. Can you explain the specific meaning of this goal? What more needs to be done to achieve this goal? Thank you.

Ran Chengqi:

I have sort of answered this question just now. Everyone has paid great attention to Beidou-3. It is really good. Will there be anything better than it later on? Our answer is yes. For Beidou-3, we should ensure that the system itself continues to improve. How to develop it into the next generation of BDS? First of all, we should build the next-generation BDS, likely BeiDou-4, to be better. This system will make further breakthroughs. First, for the satellite constellation, we now have medium-orbit and high-orbit satellites. In the future, we will also consider including low-orbit constellations to build a navigation constellation for high, medium, and low orbits. In addition to providing reliable and better performance in positioning and navigation services, there's the high-precision positioning service as I mentioned earlier. Everyone feels it is great to use, but that service is only applicable inside China. Can we push this network to be used universally? This is our expectation for the future. We particularly hope to provide such a high-precision, highly reliable, and powerful space-time network through the integration of high, medium, and low-earth orbit constellations as well as the integration with mobile communications and low-earth orbit communications. We especially hope that after construction is completed, users all over the world can share the positioning accuracy of 5cm, 2cm, 5mm, and 2mm. We have made a great demonstration of its technology, and the scheme is sound. We are very confident about its construction pace.

We also hope to lead the development of the global satellite navigation system and even the space-time field after the construction of the next-generation space-time system so that it is more ubiquitous, more integrated, and more intelligent. Being ubiquitous means the integration of various technologies and methods, including seamless coverage, which aims to solve all the problems related to space. General Secretary Xi encouraged us to "explore the vast universe," and we will go further and go to deep space. We should rely on China itself for our space-time benchmark. Whether there is a space-time benchmark in the far space of the Milky Way Galaxy... we are also working hard on it. We believe that the next generation of space-time benchmarks can solve this problem. I want to say we are looking forward to a promising future. The year 2035 is our goal. We hope to do better on this basis to make Beidou's highly reliable and high-quality services available at any time. Of course, through such high-quality services, we will also promote the development of the economy, society, and industrial chain and make new contributions to national economic and social development. Thank you.

Tianmu News:

You mentioned mass consumption and mass applications, and now we have no sense of security without mobile phones. Not long ago, the first mobile phone to support Beidou-3's short message communication service was launched. I would like you to elaborate further on it. How was this function realized? And will other mobile phones and smartphones also support this function in the future? Thank you.

Ran Chengqi:

Thank you for your question. I wanted to share this but never got a chance to do so. The application of BDS short message communication services to mobile phones is a dream we had as early as BDS-3 was proposed and approved. In addition to positioning and navigation services, BDS-3 also features a short message communication service. This function is amazing, but its application requires an expensive, exclusive terminal that must be independent of mobile phones and thus would bring a lot of inconveniences. At that time, we wondered if this function could be incorporated into mobile phones. This was a good concept, but we faced many technical problems. It takes 10 years to sharpen a sword, and it took us 10 years to work on this function. We achieved it thanks to China's progress in communications, our technological advances in the chip industry, and especially to the mobile operators and mobile phone producers. 

We first built a short messaging civil platform for BDS to deliver all the short message services. It is available to China Mobile, China Telecom and China Unicom users if combined with these mobile operators. However, it posed a great technical challenge to include these services in mobile phones. We often said it was one of our dreams to directly connect satellites with mobile phones. Today, we've achieved it. We made the terminal miniaturized and chip-based with low power consumption to realize the function. It was not our purpose to adopt another independent terminal. We wanted the function to be included in mobile phones. Thanks to our technological progress and joint efforts, we solved the issue by developing the BDS short message communication radio-frequency baseband integrated chip technology.

The function was finally included in modern mobile phones as a chip and perfectly integrated. Today's chip owes much to the efforts of mobile phone manufacturers, who did an excellent job dealing with the technical system, signal design and key problems. The current chip can be made into a mobile phone roughly at the cost of 10 yuan ($1.38) without changing the phone card and number or adding peripherals. There is no difference between a BDS-enabled mobile phone and other mobile phones. However, with this chip, we can send information through this mobile phone when there is no mobile signal. The advantage is that you can still send text messages, report your location, and provide your location track in that case. You may think that this function can hardly be felt in daily life. But ask yourself how you would feel if your mobile phone had no service, but was equipped with this function. I often say that you may never use the function, but you gain a sense of security. Nowadays, it has been widely applied to many mobile phones. You will have a sense of security if you can always connect with the outside or be seen online. The status is the security guarantee BDS provides.

In the future, we also plan to open the technology to domestic mobile phone manufacturers to provide better services. We hope more domestic mobile phone manufacturers and operators will participate. What we especially want to see is that BDS telecommunication services contribute much to our economy and society and provide a more reliable guarantee for public travel safety. We have realized the function. We can ensure that BDS-3 service covers people in the Asia-Pacific based on its capability. With a mobile phone in hand, one can travel over the Asia-Pacific and even the world. BDS has also set a precedent for direct satellite connection with mobile phones. The exploration is helpful. Some international mobile phone brands are also in pursuit of this function. From this point of view, applying BDS short message communication services to mobile phones is leading to progress in innovation. Thank you.

The Poster News APP:

Since the 18th CPC National Congress, BDS has been used in more than half of the countries and regions in the world as a pacesetter of aerospace science and technology products for export and has become a well-known global brand. Could you give some examples of BDS applications overseas? Thank you.

Ran Chengqi:

Regarding the international application of BDS, we have promoted it as a priority when participating in activities of relevant UN organizations and maritime and mobile communication organizations as well as relevant bilateral activities. We remain committed to advancing BDS' international application, and our focus is countries along the Belt and Road. The BDS' global commitment and China's status as a responsible major country has made it imperative to better promote BDS internationally. In fact, we already promoted BDS internationally when BDS-2 was completed in 2012, and achieved remarkable results thanks to our continuous efforts. When the basic system of BDS-3 was completed in 2018, it provided services for countries along the Belt and Road first. To foster understanding of the system, we have organized multiple international training courses on its application, as just mentioned. I'd also like to provide several specific, more impressive application cases here. 

BDS has become accessible in more than half of the world's countries and regions. For example, in Saudi Arabia, it has been used for surveying, mapping and collecting geographic information, developing urban infrastructure, and positioning people and vehicles in deserts, among other important fields, winning widespread acclaim from local users. In Tajikistan, real-time, continuous monitoring of the Ozero Sarezskoye Dam was carried out based on BDS to detect deformation with millimeter-level accuracy, thus ensuring the dam's safety and the lives of local people. In Lebanon, BDS' high-accuracy technology was used for wharf construction surveying at the Beirut Port. The Burkina Faso government in Africa used BDS' high-accuracy technology to carry out surveying and mapping for hospital construction, thus finishing the surveying work within six days and shortening the construction time by half, significantly contributing to pandemic control. BDS has been successfully applied in ASEAN, South Asia, East Europe, West Asia and North Africa. It has provided good services to the China-Europe freight trains. China and Russia have also conducted stronger and closer cooperation in many navigation application fields under a framework agreement for strategic cooperation until 2025. BDS has also done a good job in serving relevant road transportation systems and cross-border transportation. Such cases are too numerous to list. I want to say that BDS products and technologies have been applied in more than half of the world's countries, and we will continue to promote its application systematically. I hope that our media friends can help publicize BDS so that the world can better understand it. Thanks.

Beijing Office of Changjiang Daily:

China has seen bumper harvest this year. Could you share with us the application of BDS technology in agriculture? Thanks.

Ran Chengqi:

The application of BDS in agriculture has drawn much attention. The high-precision agricultural application of BDS will be significant since agriculture constitutes a vital area. During my visit and field trip to Xinjiang around five or six years ago, I saw the high-accuracy application of BDS. For example, I was told that when there were no high-precision products, the labor intensity of drivers was very high as they had to maintain precision while operating the harvesters and other agricultural machinery. After the broad application of the highly accurate BDS, the accuracy of the agricultural machinery can reach about two centimeters, greatly easing the drivers' labor intensity. A driver told me he didn't need to do anything in the machinery except turn the steering wheel in a corner. The vast land of Xinjiang means that farming machinery must drive long distances. Therefore, BDS could be applied well in fertilization, sowing, agrochemical spraying, harvesting and other agricultural activities. I was also told that thanks to high-precision BDS, the precision of seedling fertilization could reach around two centimeters. This seemingly small technological progress can bring about significant changes. For example, precise plowing, agrochemical spraying, and fertilization can significantly cut costs, improve efficiency, reduce labor intensity, and increase the returns of the farms.

The high accuracy of BDS has been applied in agriculture in several other cases. BDS has fully empowered agricultural production and become a vital scientific and technological force driving agricultural development. According to incomplete statistics, the number of automatic agricultural machinery based on BDS has exceeded 200,000 units (sets) this year, providing tangible services for farmers and improving agricultural ecological efficiency. During the past autumn, BDS-based self-driving tractors, seeders, harvesters and other agricultural machinery, and drones played a significant role in harvesting, plowing and sowing in Beijing, Hebei, Henan, Shandong, Zhejiang, Jiangsu, Heilongjiang, Gansu and other places. Many farmers plan the routes of the machinery through mobile phones and accurately stay on top of the farming work. BDS is now serving as a real "golden key to a good harvest" for farmers. I believe that BDS will continue to support China's precise agricultural development in the future. Thank you.

CNR:

We know that BDS has become a new economic growth driver. Since BDS-3 was opened to global users more than two years ago, a host of BDS-related new industries have emerged. How important are these emerging industries to China's economic growth? Thank you.

Ran Chengqi:

This question is a bit difficult to answer. Why? We often say that BDS is ubiquitous at every time. Since time and space information is necessary for everything, there is a line in the BDS community that satellite navigation applications are only limited by human imagination. I remember saying at other press conferences that if you think about it, without spatiotemporal information, the information we obtain and our perception of the world will be inaccurate or even useless. Therefore, time and space are crucial to our economic and social development. With the transformation of the economy and society, the development of information technology, and the advancement of intelligence and automated technologies, spatiotemporal information, especially that of high precision, has become more prominent. You referred to emerging industries in your question, but I can't find a single sector without a BDS application. We are also looking forward to integrating with emerging technologies. We are delighted to say that BDS can be integrated into all walks of life and with all emerging technologies, including intelligent technologies, automated technologies, cloud computing and big data. We often say that BDS serves everyday life. In my view, be it in the traditional industries or emerging and future industries, BDS, now well applied in various sectors, can always play a role by providing spatiotemporal information.

We have conducted over 50 demonstration projects with relevant ministries and commissions in various provinces and cities. For example, in 2012, we worked with the Ministry of Transport. We carried out the BDS demonstration application on chartered tourist buses, regular buses at class III (serving between non-adjacent counties) or above, and vehicles carrying dangerous goods. We aimed to cover 79,000 vehicles at that time. By June this year, however, the number had exceeded 8 million. If BDS is applied to more vehicles, mobile phones and industries, it will surely become a system offering comprehensive services to diverse industries. For the better operation and development of BDS, I hope that all walks of life can pay more attention to spatiotemporal information and BDS applications. The development of BDS is integrated, which can spur new sectors and industries and drive overall socioeconomic development in China. Thank you.

Shou Xiaoli:

Thank you, Mr. Ran Chengqi. Thanks to the friends from the media for your participation. Today's briefing is at this moment concluded. Goodbye, everyone.

Translated and edited by Zhang Liying, Wang Wei, Li Huiru, Qin Qi, Huang Shan, Zhang Rui, Liu Qiang, Duan Yaying, Wang Yiming, Zhang Tingting, Yuan Fang, He Shan, Yan Bin, Ma Yujia, Xu Xiaoxuan, Yang Xi, Xu Kailin, Zhang Junmian, David Ball, Tom Arnsten, and Jay Birbeck. In case of any discrepancy between the English and Chinese texts, the Chinese version is deemed to prevail.