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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

Mr. Zhu Bing, director general of 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:

July 19, 2023

Shou Xiaoli:

Friends from 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 operations in the first half of 2023 and to 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 Mr. Zhu Bing, director general of 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. I want to begin by expressing my gratitude for your continued interest in and support for our commerce work. It is a pleasure to have you all here today at this press conference. Now, let me give you a brief overview of our business operations in the first half of this year.

Since the beginning of this year, under the strong leadership of the Central Committee of the Communist Party of China (CPC) with Comrade Xi Jinping at its core, MOFCOM has fully implemented the guiding principles of the 20th CPC National Congress, focused on promoting various tasks in the business field, and promoted the introduction of a series of policies and measures. In the first half of the year, business operations generally showed a trend of recovery, and high-quality business development made steady progress.

First, domestic consumption experienced a relatively swift recovery. We organized a series of initiatives under the 2023 "Year of Consumption Promotion" campaign, introducing policies and measures to stimulate household consumption and actively promote its expansion. As a result, the total retail sales of social consumer goods reached 22.8 trillion yuan, marking a year-on-year increase of 8.2%. Notably, contact-based consumption experienced a significant rebound, with catering income surging by 21.4%. Furthermore, sales of upgraded products flourished, including a 44.1% increase in the sales of new energy vehicles (NEVs), while sales of gold, silver and jewelry, and sports and entertainment products above designated size increased by 17.5% and 10.5%, respectively. Online shopping also surged, with online retail sales of physical goods growing by 10.8%, accounting for 26.6% of the total social retail sales.

Second, foreign trade maintained its growth momentum. Despite challenges such as weak international demand, we diligently implemented guidelines for stabilizing the scale and optimizing the structure of foreign trade. We have assisted enterprises in expanding markets and securing orders. In the first half of the year, imports and exports of goods totaled 20.1 trillion yuan, an increase of 2.1%, and exports increased by 3.7%, with a surplus of 2.8 trillion yuan, an increase of 17.4%. China's exports accounted for 14% of the international market in the first quarter, a rise of 0.3 percentage point from the previous year. Notably, our trade with emerging markets surpassed that with Europe and the United States, with a 5.4% increase in imports and exports to ASEAN, 7% increase to Latin America and 10.5% increase to Africa. Meanwhile, exports to the EU grew by 1.9%, while exports to the United States declined by 8.4%. Private enterprises displayed considerable resilience in their import and export activities, achieving an 8.9% increase, and their share rose by 3.3 percentage points to 52.7%. The "three new products" (electric vehicles, lithium batteries and solar cells) gained significant momentum, leading to a remarkable 61.6% increase in total exports, thus becoming a new driving force for trade growth. Additionally, there was a notable 6.3% increase in the export of mechanical and electrical products. Trade in services also experienced rapid growth, with imports and exports of services in the first five months reaching 2.6 trillion yuan, representing a 10.2% increase. Specifically, the import and export of travel services saw a remarkable surge of 67%.

Third, the absorption of foreign capital remained stable. Since the beginning of this year, we have dedicated ourselves to a series of "Year of Investment Promotion" activities to attract and utilize foreign capital more effectively. The number of newly established foreign-funded enterprises saw a rapid increase. In the first half of the year, 24,000 foreign-invested enterprises were established, marking a significant rise of 35.7%. The actual utilization of foreign capital decreased by 2.7%, reaching 703.65 billion yuan. Investment from developed countries continued to grow in China, with France, the United Kingdom, Japan and Germany witnessing increases of 173.3%, 135.3%, 53% and 14.2%, respectively. The quality of foreign investment also improved, particularly in high-tech industries, which experienced a 7.9% increase, accounting for 39.4% of the total foreign investment, rising by 3.9 percentage points. Foreign investment in high-tech manufacturing specifically rose by 28.8%. The role of leading opening-up areas in driving investment is evident, as the 21 pilot free trade zones attracted 129.66 billion yuan of foreign capital, representing an increase of 8.2%, and accounting for 18.4% of the country's total foreign investment.

Fourth, foreign investment and cooperation steadily progressed. We continued to enhance the quality and level of foreign investment and cooperation while further advancing the high-quality development of the joint construction of the Belt and Road Initiative (BRI). In the first half of the year, China's non-financial outbound direct investment totaled 431.61 billion yuan, registering an increase of 22.7%. We expanded cooperation in new areas like the green, digital and blue economies. During this period, we inked new memorandums of cooperation with four countries, including Brazil, and signed a total of 41 investment cooperation memorandums in related fields. We also saw improvements in the quality and efficiency of overseas contracted projects, achieving a 7% increase in turnover to 490.1 billion yuan, while the construction and operation of key projects steadily moved forward.

Fifth, bilateral and multilateral cooperation continues to deepen. We continue to expand the global network of high-standard free trade zones (FTZs) and the comprehensive implementation of the Regional Comprehensive Economic Partnership (RCEP). We held negotiations on version 3.0 of China-ASEAN Free Trade Area (FTA) and the ministerial meeting with signatories of the Digital Economy Partnership Agreement, and actively promoted our accession to the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). In the first half of the year, China signed a free trade agreement (FTA) with Ecuador, completed substantive negotiations on the FTA upgrade with Singapore, and put into effect the early achievements of FTZ negotiation with Nicaragua. We firmly upheld the multilateral trading system and actively participated in WTO reform. China has played a key role in concluding negotiations on the text of the Investment Facilitation for Development agreement, and completed the domestic ratification process of the Agreement on Fisheries Subsidies. A total of 14 Chinese proposals were made in fields such as trade and the environment. We continue to deepen bilateral economic and trade cooperation. A series of events were held, including the Fifth Meeting of the Council of China-France Entrepreneurs, the Sino-German Entrepreneurs Roundtable, China-Central Asia Economic and Trade Ministers' Meeting, China-Africa Economic and Trade Expo, and the China-Central and Eastern European Countries (CEEC) Expo.

Next, MOFCOM will follow the guidance of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era and fully implement the decisions and plans made by the CPC Central Committee and the State Council. We will work to perform the important role of commerce development in three aspects. Efforts will be intensified to ensure stable performance in foreign trade and investment, as well as to promote consumption, providing strong support for sustaining China's economic recovery.

That concludes a brief overview of our work. Next, my colleagues and I are happy to answer your questions. Thank you.

Shou Xiaoli:

Thank you. Now the floor is open for questions. Please identify the news outlet you work for before asking your question.

CCTV:

It was recently proposed at a State Council executive meeting that when conditions allow, policy measures should be introduced promptly and implemented in a timely manner, while also expanding the toolkit of policy options to maximize their combined effects. What policies will be introduced to ensure steady economic growth in the future? Thank you.

Guo Tingting:

Thank you for your question. This is indeed a question that is of concern to all sectors of society, and represents the common expectations of the market.

Since the beginning of this year, MOFCOM has fully implemented the decisions and plans of the CPC Central Committee and the State Council. As I just mentioned, we have taken multiple measures to stabilize foreign trade and investment and promote consumption, to fully unleash the effect of multiple policies. Our work in the first half of the year has mainly been in the following aspects: first, many policy measures were introduced and implemented. Some of them aim to stabilize the scale and improve the structure of foreign trade; some encourage the establishment of foreign-funded R&D centers; some are pilot measures for aligning with international rules and promoting institutional opening-up in qualified FTZs and ports; and some are policy documents for bolstering the consumption of home furnishings and green and smart home appliances and improving and diversifying home services. Second, we have launched several campaigns, including events for boosting consumption and attracting investment that will run through the year. In the consumption boosting events, we collaborated with local governments and industry associations to improve consumption expectations and the consumption environment. And with the help of the investment promotion events, we promoted both inbound and outbound investment. Third, a series of significant expos were held, including the third China International Consumer Products Expo and the 133rd China Import and Export Fair.

A State Council executive meeting recently called for fully unleashing the effect of multiple policies. MOFCOM will continue to implement the policies that have been introduced and accelerate the rollout of policy measures that are ready to but not yet be introduced. Furthermore, we will carry out in-depth investigations and research, reinforce policy options, and fully implement a combination of policies to ensure commerce development, providing support for China's economic recovery. In terms of foreign trade, we will develop measures to help NEVs expand their international markets, upgrade processing trade, provide more convenience for business people to apply for visas, and resume and increase international flights. Efforts will also be made to organize significant expos, such as the China International Import Expo (CIIE), China Import and Export Fair, and China International Fair for Trade in Services (CIFTIS). In terms of foreign investment, we will introduce policies to further optimize the business environment for foreign investment and promote continuing to shorten the negative list for foreign investment. We will continue to hold roundtable discussions with overseas enterprises and maintain regular exchanges and communications with foreign-funded enterprises. In terms of consumption, we will continue carrying out campaigns that promote consumption, boosting consumption of imported products and consumption in summer holiday and autumn season. We will also roll out measures to increase the consumption of automobiles, promote sound development of the catering industry, and encourage the use of digital technology to improve life services, among others.

We will keep you updated on the progress of related work through various channels, including MOFCOM's press conferences. Your continued interest and support are greatly appreciated. Thank you.

Zhonghongnet:

The Central Economic Work Conference proposed giving priority to restoring and expanding consumption. What work has been carried out in the first half of the year to promote consumption, and what have been the results? Thank you.

Xu Xingfeng:

Thank you for your interest in the consumption work. Consumption is the ultimate demand and the enduring driving force for economic growth. Since the beginning of the year, MOFCOM has fully implemented the decisions and plans of the CPC Central Committee and the State Council about giving priority to restoring and expanding consumption. We have introduced policies, launched campaigns, improved consumption environment, and stabilized supply. The consumption market in the first half of the year showed a steady recovery. Ms. Guo just briefed us on the related work. Our work has mainly been in the following aspects:

First, we stabilized consumption in key areas, consolidating consumption fundamentals. As we said before, automobiles, home appliances, home furnishing and catering are four major fields of consumption. We introduced multiple policy measures to encourage consumer spending on big-ticket items. In terms of automobiles, measures were made to improve electric vehicle battery charging facilities and tap the rural market for NEVs. Recently, we rolled out two campaigns to boost automobile sales in various cities and spur NEVs consumption in counties and towns. We also launched a nationwide secondhand car information inquiry platform, aimed at creating a positive and reassuring experience for people when buying secondhand cars. In the first half of the year, the auto sales and the growth of NEV consumption were very pleasing. As Ms. Guo said earlier, used vehicle sales in China surged 15.6%, showing a steady recovery. In terms of home appliances, we stepped up efforts to support the consumption of green and smart home appliances. In the first half of the year, major e-commerce platforms saw a 67% and 12.7% increase in sales of replacement home appliances and green and smart home appliances sold in rural areas, respectively. In terms of home furnishing, we already provided information in this respect yesterday. In terms of the catering sector, a series of gourmet events were held to promote the recovery and development of the catering industry.

Second, we focused on creating a consumer-friendly environment through activities. As Ms. Guo mentioned, the consumption boosting events will run through the year with seasonal themes, monthly exhibitions and weekly attractions, with the aim to create many consumption booms. In the first half of the year, we held four themed events for boosting spring consumption, national consumption, green consumption and international consumption. We also held major expos, such as the China International Consumer Products Expo and the China International Silk Expo. A number of major events were held, including consumption promotion activities for cotton and textile products, time-honored brands and online-shopping. We are grateful to the media for their coverage of these events and for making them known to the public. Additionally, we encouraged local governments nationwide, including in Shanghai, Beijing, Tianjin, Hebei, Chongqing and Guangxi, to carry out various consumption promotion events with local characteristics.

Third, we have improved the environment to encourage consumption. As you all know, China is developing five international consumption centers in the cities of Shanghai, Beijing, Guangzhou, Tianjin and Chongqing. In this regard, we have stepped up efforts and held the second International Consumption Center City Forum to promote exchanges and mutual learning among cities. Meanwhile, we have also promoted renovating existing commercial pedestrian streets and upgrading business formats across the country. We have designated 12 national demonstration smart business areas to enhance urban commerce. A total of 2,057 "15-minute community life circles" have been built in 80 regions nationwide to address weak links in community businesses. We have promoted the development of county-level commercial systems and improved rural commercial outlets. According to the National Bureau of Statistics, retail sales of consumer goods in urban areas increased by 8.1% from January to June, while those in rural areas grew by 8.4%.

Fourth, we have ensured supplies meet basic public consumption needs, which has always been a focal point of our efforts. Focusing on daily necessities such as grain, oil, meat, eggs, milk, fruits and vegetables, we have maintained the market monitoring and warning system. We have strived to improve commodity circulation and ensure supply of daily necessities. In the first half of the year, 6,200 pieces of market monitoring information concerning daily necessities were released via a business forecast platform, attracting significant attention from certain enterprises and local governments. Moreover, we have also made active efforts to deal with the impact of natural disasters on the market, such as earthquakes in Luding county of Sichuan province and Shaya county of Xinjiang Uygur autonomous region, flooding in Henan province and Guangxi Zhuang autonomous region, and the recent rainstorm in Chongqing. We have ensured emergency supplies of daily necessities in disaster areas. Moreover, according to the trend of the pork market, we purchased and stored pork in time to guide pork prices back to reasonable. That's all. Thank you.

Phoenix TV:

In recent years, the scale of China's foreign investment has continued to rise, but the actual amount of foreign investment used in the first half of this year has decreased. What's your opinion about that? Thank you.

Zhu Bing:

Thank you for your attention to foreign investment data. In recent years, MOFCOM has implemented the policy decisions and plans of the CPC Central Committee and the State Council. We have worked with local governments and other departments to ensure stable performance in foreign investment. We have achieved continuous expansion of the scale of foreign investment in China, with the investment structure having been improved continuously. These efforts have positively contributed to promoting economic and social development and building a new development pattern. In 2022, despite a 12% decline in global transnational investment, foreign investment in China grew by 6.3%. China's actual use of foreign investment hit a record high, reaching 1.2 trillion yuan ($189.13 billion), representing an increase of 8% and ranking second globally. Since the beginning of this year, the world economy's recovery has slowed, and global transnational investment has been sluggish. The recent UNCTAD World Investment Report 2023 shows that global foreign direct investment continues to face downward pressure this year due to multiple factors. Given this impact, compounded by the high base in the same period of 2022, the actual use of foreign capital in China in the first half of this year showed a slight year-on-year decline of 2.7%, but the overall scale remained stable. 

We believe that the short-term fluctuation will not affect the continued optimism of foreign investors in China's growth, and the overall trend of expanding investment in China has not changed. Recently, we've observed a continuous stream of visits to China by senior executives from multinational companies. Their aim is to conduct comprehensive, in-depth assessments of China's business environment and to explore new opportunities for investment and cooperation. Multinationals widely agree that the Chinese market, which contains enormous development opportunities, is not an "option" but a "must." They will continue to increase investment in China and explore the Chinese market. As Ms. Guo just mentioned, in the first half of this year, the number of new foreign-invested enterprises in the country increased by 35.7% year on year, which also fully proves this point. 

We believe that with the concerted efforts of all parties, the effects of foreign investment policies and measures will gradually emerge. With an improved business environment, China will remain a favored foreign investment and business destination. Thank you!

Reuters: 

China's accession to the CPTPP requires the support of all current members, but some of them may face potential political constraints that prevent them from supporting the Chinese application. How does China plan to overcome current CPTPP members' concerns that their trade relationship with the U.S., the world's largest economy, could be at risk if China were to join the bloc? Thank you. 

Guo Tingting:

Thank you for your question. It is true that China has been proactively working toward its accession to the CPTPP. Let's have Mr. Yang Tao give the details.

Yang Tao: 

Thank you for your question. China applied to join the CPTPP in September 2021, and is now actively working to accelerate the accession process. We have conducted comprehensive and in-depth analysis, evaluation and research on all CPTPP provisions and identified possible measures and laws and regulations that need to be amended. Currently, China is communicating and negotiating with the members, following the procedures for joining the CPTPP. China has advocated building open, transparent, mutually beneficial and win-win regional free trade arrangements and promoted trade and investment liberalization and facilitation. Going forward, China is willing to maintain communication and exchanges with the members on China's accession to the CPTPP. Thank you!

MNI: 

In view of weak external demand, it is expected that China's export outlook faces difficulties in the second half of the year. How will MOFCOM support export enterprises in the second half?

Li Xingqian:

Thank you for your question. The decline in international market demand represents a significant factor influencing the development of foreign trade. If we look further back, global trade is returning to its pre-epidemic trends. The average annual growth rate of global trade during the three years of the epidemic was 9.7%, clearly higher than the average yearly growth rate of 2.4% from 2010 to 2019 before the epidemic. We believe that such high growth during the epidemic was temporary and unsustainable.

Looking forward to the second half of the year, foreign trade faces many uncertain, unstable and unpredictable factors. With economic and non-economic factors interacting, the situation is extremely difficult, which can be seen in two ways. On the one hand, global economic and trade growth is weak. The three driving forces of production, consumption, and investment are sluggish. The global manufacturing PMI has been below the 50-point mark for nine consecutive months. Inflation in major economies is still at a high level, and the recovery in commodity consumption has been relatively slow. On the other hand, non-economic interference is on the rise. Some countries have pushed for "decoupling," "chain disruption," and so-called "de-risking," putting up artificial obstacles to impede regular economic and trade exchanges. Enterprises say that some countries' politicization of trade issues has led to the forced transfer of orders and production capacity, harming the economic interests of both suppliers and buyers.

Despite facing these difficulties and challenges, we remain confident. China's foreign trade industry and supply chains are resilient. China's foreign trade enterprises, which have become strong competitors in the international market, have inherent innovation ability. Recently, we have followed up on key foreign trade industries and enterprises and noticed some positive changes. For example, cross-border transactions are becoming smoother, and the number of international flights is steadily recovering. The share of enterprises with flat or growing new contracts is picking up. For the electronic information industry, which is under pressure, the import of intermediate goods is on the rise, which means there may be a favorable turn in the year's second half. In addition, China's competitive products, such as electric vehicles, solar cells and lithium batteries, will continue to grow rapidly. Multilateral and bilateral trade cooperation, including the BRI and free trade agreements, are also unlocking the potential for trade growth.

In the second half of this year, MOFCOM will continue to adopt a problem-oriented approach and cooperate with localities and government departments to create synergy, fully promoting the stability and improvement of foreign trade. We will focus on three aspects. First, more efforts will be made to help enterprises keep orders stable and expand markets and ensure the success of a number of major expos, including the CIIE, the China Import and Export Fair, and the CIFTIS. We will support enterprises to participate in overseas exhibitions to market their products and services. Faster visa processing will be promoted, and efforts will be made to facilitate the resumption and addition of more flights to international routes. Second, we will safeguard the stability of industrial and supply chains. Efforts will be made to improve processing trade, dynamically adjust the catalog of maintenance products in comprehensive bonded zones, step up monitoring and early warning of trade risks, and help enterprises cope with unreasonable trade restriction measures. Meanwhile, we will be more proactive in expanding imports. Third, we will further innovate the development of foreign trade. We will support the continuous upgrading of the country's distinctive and competitive products, guide cross-border e-commerce brand cultivation and standard development, and promote the development and application of trade document digitalization. At the same time, training involving new models, green and low-carbon trade, and free trade agreements will be held in different sectors, helping enterprises enhance trade capacity. Thanks.

21st Century Business Herald:

This year marks the 10th anniversary of the establishment of China's pilot FTZs. My question is, in the first half of this year, what has MOFCOM done with regard to implementing the strategy of upgrading the pilot FTZs and tap into their roles as pilot platforms for comprehensive reform and opening up? Thanks. 

Guo Tingting:

Thank you for your question. As you said, this year marks the 10th anniversary of the establishment of China's pilot FTZs. We have some considerations regarding this landmark. Mr. Yang will explain the details. 

Yang Tao:

Thanks. The pilot FTZ construction is a major strategic measure adopted by the CPC Central Committee with Comrade Xi Jinping at its core to further reform and open up in the new era. As you said, this year marks the 10th anniversary of China's pilot FTZ construction. From the new start, MOFCOM has continued to thoroughly study and put into practice the important instructions on pilot FTZ construction given by General Secretary Xi Jinping and firmly implemented the pilot FTZ upgrading strategy in accordance with the key plans made at the 20th CPC National Congress. Our work has focused on three aspects:

First, we have prioritized connections with high-standard international economic and trade rules amid efforts to promote institutional opening-up. Recently, we submitted a circular to the State Council for release on deepening reforms in some eligible pilot FTZs and the Hainan Free Trade Port to align with high-standard international economic and trade rules amid efforts to boost institutional opening up. The circular focuses on pilot policies and measures and risk prevention and control approaches in six major fields, including trade in goods and services, the temporary entry of business personnel, digital trade, business environment, and risk control, and supports the five eligible FTZs in Shanghai, Guangdong, Tianjin, Fujian, and Beijing and the Hainan Free Trade Port to take the lead in the pilot work. This will help explore the path for comprehensively deepening reform and expanding opening up, providing practical support for joining high-standard economic and trade agreements.

Second, we have worked to expand the application of a new batch of institutional innovations to unleash greater reform dividends. We recently submitted to the State Council for release a circular on expanding the application of the seventh batch of reform experiences tested in China's pilot FTZs nationwide or in special regions, involving 24 reform measures in total. This is expected to further unleash the dividends of the reform and opening-up policies of pilot FTZs, and help improve the business environment and build a higher-level open economy. 

Third, we have adopted a to-do list to guide our efforts in the next three years, and advance differentiated exploration. The list nails down 164 major tasks relevant pilot FTZs plan to handle independently in the next three years amid efforts to strengthen categorized guidance and help pilot FTZs deepen reform and practical innovation in accordance with their local conditions. 

High-level institutional innovations have effectively stimulated the vitality of pilot FTZs. Statistics show that in the first half of this year, utilized foreign investment in 21 pilot FTZs reached 129.66 billion yuan, a year-on-year increase of 8.2%. The growth of utilized foreign investment by high-tech industries reached 21.2% year on year. Overall, pilot FTZs cover less than 0.4% of national land and attracted 18.4% of total foreign investment in the country. 

Moving forward, MOFCOM will continue to fully implement the guiding principles of the 20th CPC National Congress and focus on three improvements, which are: improving the alignment with high-standard international economic and trade rules, market access, and systemic integration of reform. Efforts will be made to fully implement the strategy to upgrade pilot FTZs and other relevant policies and measures, and tap into their roles as pilot platforms for comprehensive reform and opening up, making continuous contributions to the high-level opening up. Thanks.  

CNBC:

I have two questions. First, in the first half of this year, how many executives from foreign companies have visited China, especially those from the US and Europe? Second, what kind of achievements has the "Invest in China Year" series of investment promotion activities made in the first half of the year, and how does MOFCOM plan and expect to attract foreign investment in the second half of this year?  

Zhu Bing:

Thank you for your questions. Since the beginning of this year, many executives of transnational corporations have come to China to evaluate the investment environment and search for new opportunities, which speaks volumes about their strong willingness to invest in China and optimism about China's prospects. MOFCOM warmly welcomes investors of various countries. Chinese Commerce Minister Wang Wentao met with visiting executives of transnational corporations more than 20 times this year, detailing our new policies and measures for attracting and utilizing foreign investment, and holding deep conversations about consolidating existing cooperation and further exploring potential cooperation. Recently, on the basis of our regular communication mechanisms, MOFCOM established a roundtable meeting mechanism with foreign companies to expand the communication channels between the Chinese government and foreign companies, which has helped to enhance communication, respond to enterprises' concerns in a timely manner, coordinate efforts to resolve the difficulties and problems foreign businesses face in their operations, and offer more effective and relevant services.   

According to the preliminary information, more executives of transnational corporations plan to visit China in the second half of this year. We will try our best to facilitate their evaluation of the investment environment, their efforts to align development strategies, and their negotiation of cooperation projects. China will become more and more open. Transnational corporations are welcome to continue their investment in China and share China's huge market and the dividends of open development.  

The second question was about the "Invest in China Year" series of investment promotion activities. I will brief it now. Implementing the decision and plan made by the CPC Central Committee and the State Council on making greater efforts to attract and utilize foreign investment, MOFCOM hosted for the first time the "Invest in China Year" series of investment promotion activities with the theme of "Invest in China, Working Together for a Bright Future of Openness and Prosperity." These events cover the country's east, central, west, and northeast regions and comprehensively display the business environment and investment opportunities in different localities, confirming the reliability of investing in China. So far, a total of 14 events of three categories have been held. 

The first category is comprehensive events. This March, we hosted the launch ceremony of "Invest in China Year" in Guangzhou, which Chinese Vice Premier He Lifeng attended and addressed with a keynote speech. In the presence of almost 100 transnational corporations, he reiterated China's determination to enhance opening-up, helping to strongly boost the confidence of foreign investors in China. 

The second category is "bringing in" activities. We held special local promotions in Guangdong, Chongqing, Tianjin and other places, and a national-level economic and technological development zone promotion event in Jiangsu province. We organized and carried out a series of activities, such as the "Multinational Corporations in Heilongjiang and Inner Mongolia" and "CIIE Enters Jilin and Yunnan." In line with the actual development and industrial characteristics of various regions, we actively promoted opening-up policies, investment environment and projects, and vigorously supported investment attraction around the country, especially in the central, western and northeast regions.

The third category is "going global" activities. We visited the Gulf countries to carry out special promotions, which attracted the participation of more than 70 local companies, and promoted the positive progress of many investment projects in China. We held the launch ceremony for the "Year of Investment Promotion — Germany Station" activity in Germany, in which more than 100 German companies and business associations participated, and many companies put forward investment plans. During the Year of Investment Promotion series of activities in the first half of the year, various regions continued to increase their efforts to attract investment. According to incomplete statistics, more than 2,900 foreign investment projects are currently being discussed in various regions.

Next, we will focus on promoting the implementation of policies and measures in various foreign investment fields, and continue holding the Year of Investment Promotion series of activities. We aim to better guarantee foreign investment services, strive to create a market-oriented, law-based and internationalized first-class business environment, help foreign-funded enterprises deepen their presence in the Chinese market, and share the dividends of China's development. Thank you.

The Paper:

Affected by factors such as shrinking external demand, China's foreign trade imports and exports were under pressure in the first half of the year. How does MOFCOM evaluate the situation of foreign trade imports and exports in the first half of the year? In addition, we've noticed a significant decline in the growth rate of imports and exports in May and June. What is the reason behind this? Thank you.

Li Xingqian:

Thank you for raising these two important questions. Your first question is about the import and export performance in the first half of the year. Since the beginning of this year, the external challenges facing foreign trade have indeed increased significantly. The State Council has issued policy measures in a timely manner to fully support foreign trade enterprises in exploring markets. Overall, in the face of a severe and complex external environment, foreign trade in the first half of the year withstood the pressure and demonstrated strong resilience. There have been outstanding performances in three areas:

First, the overall scale of trade has remained stable, and the volume of trade has continued to grow. From January to June, China's imports and exports of goods exceeded 20 trillion yuan, with a year-on-year increase of 2.1%. When compared with the same period before COVID-19, that is, the first half of 2019, it increased by 36.7%. We continue to maintain our position as the world's largest trading nation in goods, and our market share is steadily increasing. According to the latest data from the World Trade Organization (WTO), in the first quarter, global exports fell by 1.6% year on year, while China's export market share in the international market was 14%, an increase of 0.3 percentage point compared with the first quarter last year. Our monitoring also shows that in the second quarter, China's export share in the international market still maintained a steady and rising trend. Against the backdrop of overall sluggish global demand, our neighboring countries and regions have generally experienced double-digit declines in exports. China's export market is diverse, and its products are rich, effectively offsetting the impact of weak external demand and the cyclical decline of some products. The current performance of China's foreign trade is in line with expectations.

Second, the quality of trade has been continuously improved. From January to June this year, the share of emerging markets in imports and exports increased by 1.8 percentage points compared with the same period last year, reaching 63.5%. Our imports and exports to FTA partners increased by 2.4%, and to countries along the Belt and Road grew by 9.8%, both higher than the overall export growth rate. The quality of exported products is improving, and high-quality, high-tech and high-value-added products are growing strongly. In the first half of the year, electric passenger vehicles, solar cells and lithium batteries together boosted the overall export growth rate by 1.8 percentage points. The model of foreign trade is also being innovated and developed. We have replicated and promoted 30 excellent practice cases of new foreign trade models nationwide. In the first half of the year, cross-border e-commerce exports increased by 19.9%, maintaining a fast development momentum.

Third, foreign trade has effectively served the overall economic development. Foreign trade has continued to drive the recovery of the national economy, directly and indirectly employing 190 million people. Last year, we canceled the registration requirement for foreign trade operators, further stimulating the enthusiasm of market entities. From January to June, there were 35,000 new foreign trade enterprises with import and export records compared to the same period last year. In terms of ensuring supply in the domestic market, we actively expanded imports of grain, energy and resource products, and high-quality consumer goods to meet domestic production and living needs. In terms of opening-up, we promoted the comprehensive implementation of the RCEP among the 15 signatory countries, so that the internal and external circulations flow more smoothly.

Your second question is about the decline in the growth rate of China's imports and exports in May and June. This is actually a direct reflection of the weak recovery of the world economy in the field of trade. Specifically, there are four main reasons for the decline. First, overall external demand remains weak. Major developed countries are still adopting austerity policies to cope with high inflation, and some emerging markets have significant fluctuations in their exchange rates and insufficient foreign exchange reserves, which has significantly suppressed import demand. Second, the electronics and information industry is in a cyclical downturn. Consumer electronics products are one of China's leading export products, but this field has an "Olympic cycle" and is currently in a low for the four-year period. Affected by this, the export growth rate of computers, integrated circuits and cellphones, which account for more than 30% of our country's exports, has declined by double digits. Third, the import and export base in the same period last year was significantly raised. From May to June last year, the average monthly import and export volume was 3.57 trillion yuan, which was 430 billion yuan higher than the average monthly volume of 3.14 trillion yuan in the preceding four months. Fourth, import and export prices are declining. Currently, international commodity prices have been weakening. In May, China's import prices fell by 4.5%, and in June, they fell by a further 8.5%. The export prices also turned negative year on year from May, indicating a shift from positive to negative.

However, we should also note that foreign trade is accumulating new vitality despite declining import and export growth in May and June compared to the same period last year. The month-on-month growth rate has remained positive. The foreign trade cargo and container throughput at China's ports monitored by the transportation department is also growing, and the actual flow of goods in and out is still rather active. Therefore, we remain optimistic about the prospects of foreign trade in the second half of the year. Thank you.

Economic Daily:

What were the new achievements and highlights of Belt and Road economic and trade cooperation during the first half of 2023? What efforts will be taken to promote high-quality Belt and Road cooperation? Thank you.

Guo Tingting:

Thank you for your questions. I'd like to address them. Since the start of this year, MOFCOM has fully implemented the important instructions of General Secretary Xi Jinping on jointly promoting Belt and Road Initiative and the decisions and arrangements of the 20th National Congress of the CPC. We've worked with all related parties to steadily advance Belt and Road economic and trade cooperation. New achievements have been made on various fronts. 

First, the foundation of trade and investment has been continuously strengthened. We secured a steady growth of trade volume and an increasingly optimized trade structure. Over the past six months, our goods trade with Belt and Road countries reached 6.89 trillion yuan, marking a 9.8% year-on-year increase. This is 7.7 percentage points higher than the nation's overall growth in goods trade during the same period. Our exports of NEVs, machine tools, and household appliances to Belt and Road countries rose by 163.3%, 49.7% and 26.2%, respectively. Meanwhile, our imports of quality specialty products, including agricultural products from Belt and Road countries, grew by 17.9%, and fertilizers by 71.7%. We also noted the rapid growth in bilateral investment. In the first half of the year, our non-financial direct investment in Belt and Road countries reached 80.1 billion yuan, an increase of 23.3%, and we received 55.95 billion yuan of actualized investment from Belt and Road countries, a 23.7% increase.

Second, we have strengthened connectivity. On the one hand, we have advanced the "hard connectivity" of infrastructure. In the past six months, the turnover of Chinese enterprises' contracted projects in Belt and Road countries totaled 277.72 billion yuan, an increase of 11.5%. Key projects like the Cambodia Sihanoukville Special Economic Zone and the China-Laos Railway commenced operation smoothly. We made new progress in constructing the New International Land-Sea Trade Corridor, a joint endeavor between China and Singapore. Based on industrial park cooperation agreements, China and some ASEAN countries took steps to jointly develop demonstration zones for innovative economic and trade development. On the other hand, we facilitated the "soft connectivity" of economic and trade rules and standards. RCEP took effect in 15 member countries, and the version 3.0 China-ASEAN FTA negotiations were held. We also signed a free trade agreement with Ecuador. Most importantly, we deepened the "connectivity of the heart." Several "small but beautiful" programs aimed at enhancing education, healthcare and poverty alleviation were carried out in Belt and Road countries, greatly improving local people's livelihoods. We also advanced nine programs of China-Africa cooperation.

Third, the building of mechanisms and platforms has been improved. We established working groups to facilitate trade with two countries and promote investment with five countries. In terms of cooperation in emerging sectors, we signed eight memorandums of cooperation with six countries on green development, the digital economy, the blue economy, e-commerce, and trade in services. To fully utilize cooperation platforms, we successfully hosted the third CEEC Expo & International Consumer Goods Fair and the third China-Africa Economic and Trade Expo.

Following the guidance of the CPC Central Committee and the arrangements of the State Council, MOFCOM will continue to enhance economic and trade cooperation with Belt and Road countries and expand cooperation spaces to make new contributions to high-quality Belt and Road cooperation with more win-win results. Thank you.

Macau Monthly:

The United Nations Conference on Trade and Development (UNCTAD) offered an analysis of global multinational investment in its recent report. What is your take on the trend of China's attractiveness to foreign investment in the second half of 2023? What measures will be taken to attract and make use of foreign investment? Thank you.

Zhu Bing:

Thank you for your questions. As you noted, the UNCTAD report indicates that global multinational investment declined by 12% last year, with further downward pressure being projected for this year. The external environment for attracting investment is severe as global investment is experiencing a downturn, and competition for investment introduction is becoming increasingly intense. Nevertheless, it's important to remember that the fundamentals of the Chinese economy, characterized by its strong resilience, enormous potential, and long-term growth, remain unchanged. China's vast open market presents numerous opportunities for foreign enterprises. Our overall advantages in attracting investment, created by a complete industrial system, impeccable infrastructure, abundant human resources, and a continuously improving business environment, are constantly being reinforced. Under the strong leadership of the CPC Central Committee and the State Council, we are both determined and confident in our ability to successfully attract and utilize foreign investment this year. We will coordinate with all localities and government departments, prioritizing the following four aspects of work.

First, we will push for a higher standard of opening up. The negative list for foreign investment access will be appropriately shortened, and restrictions will be either eased or removed entirely. To advance the comprehensive pilot program for service sector opening, we will implement a number of trial measures, drawing on the rules, regulations, standards, and management models stipulated in high-standard economic and trade agreements, thereby steadily advancing the institutional opening of the sector. We will also revise the Measures for Strategic Investment by Foreign Investors in Listed Companies to further relax restrictions in this area.

Second, we will strengthen policy support for foreign investment. MOFCOM has directed localities to conscientiously implement special policies for foreign-invested research and development centers, foreign investment in manufacturing, and the catalog of encouraged foreign investment industries. More foreign investment has been directed toward advanced manufacturing, with its introduction to high-tech manufacturing increasing by 28.8% in the first half of 2023. While diligently implementing existing policies, we will redouble efforts to address foreign enterprises' common calls for fair competition, trade facilitation, and supply of production factors. New policies and measures will be adopted to enhance the business environment and attract foreign investment. We will collaborate closely with all localities and government departments to ensure effective policy implementation and bolster foreign enterprises' sense of gain. 

Third, we will continue to host the Year of Investment Promotion series of activities. As I just said, in the first half of the year, we organized 14 major events, effectively promoting our investment environment and policies, encouraging multinational companies to better understand and invest in China. In the second half of this year, we plan to host nine key events in conjunction with major economic and trade exhibitions. This includes a Year of Investment Promotion keynote forum during the China International Fair for Investment and Trade (CIFIT), a specialized session for the service industry at the CIFTIS, a dedicated promotion for China's central region during the Expo Central China, and a Year of Investment Promotion summit during the CIIE. We hope these events can bolster local governments in attracting investments, fostering project collaborations, and bringing in more promising foreign investment projects for China.

Fourth, we will elevate the level of service support for foreign investment. This year, we have fully utilized the foreign trade and investment coordination and service mechanism, and the specialized team for key foreign investment projects, strengthened regular exchanges with foreign-funded enterprises and foreign business associations, and upgraded and established a roundtable conference system for foreign-funded enterprises to carry out multiple forms of exchange activities at various levels. Recently, Minister Wang Wentao has presided over roundtable meetings with foreign-funded enterprises in the pharmaceutical industry and Japanese enterprises, listening to their feedback and addressing their concerns. Next, we will continue to leverage the roundtable system and develop it into an vital platform for the Chinese government to connect with, serve and support foreign-invested enterprises. Should any enterprise encounter difficulties or problems related to their investment or operations, they can directly contact the designated team for foreign investment under MOFCOM.

Thank you.

Yicai:

According to recent data, in the first half of the year, China's consumer market achieved a stable and rapid recovery. However, the rebound in big-ticket items such as home furnishings and appliances remains insufficient. What measures will be taken in the next step? Thank you.

Xu Xingfeng:

Thank you for your question. The topic is a common concern for many people. In the first half of this year, total retail sales of consumer goods increased by 8.2% year-on-year. Everyone has high expectations regarding how to sustain the positive momentum in consumption and stabilize the demand for big-ticket item such as household appliances, home furnishings, and automobiles. The meeting of the Political Bureau of the CPC Central Committee emphasized that restoring and expanding demand is key to maintaining and motivating the current economic recovery. Next, MOFCOM will diligently implement the deployments and decisions made by the CPC Central Committee and the State Council, continue to integrate the strategy of expanding domestic demand with deepening supply-side structural reform, and enhance policy coordination and working collaboration, deepening the level of implementation. We will focus on the following four aspects:

First, we will focus on optimizing the consumption environment and implementing more detailed policies. As I introduced earlier, the State Council and related departments have issued a series of policies around promoting consumption, so the next step is to "cultivate and flourish." This means that these policies that have been issued can actually be transformed into results. As you mentioned just now, the household consumption policy covers a wide range, including home appliances, furniture, home decorations, home textiles and housekeeping. Yesterday, we held a policy briefing here to introduce the relevant implementation considerations.

In addition, as discussed and reviewed by the executive meeting of the State Council last year, MOFCOM and 17 other departments have issued policies and documents on boosting the circulation of automobiles and expanding automobile consumption, many of which are currently in progress. Responding to the issue of "mileage anxiety" concerning NEVs, MOFCOM, based on its own responsibilities, is working with other departments to actively improve the charging infrastructure. For example, on the premise of ensuring safety, we are encouraging the installation of charging facilities in gas stations and parking lots of shopping malls, supermarkets, shopping centers and so on where conditions allow. These policies form a cohesive approach to stabilize and expand automobile consumption. In addition, we will carry out in-depth investigations and studies, enlarge policy reserves and enrich our policy toolkit in light of changes to the current consumer market, and promote the introduction of policies at the appropriate times.

Second, we will focus on cultivating a vibrant consumption atmosphere by continuously organizing engaging consumer events. The Year of Consumption Promotion which we just introduced has now entered its second half when policies should be implemented with further precision and various activities should be conducted well and effectively. Nationwide, the "Home Refresh Consumption Season" will serve as a major promotion to harness people's enthusiasm toward all kinds of household furnishings. On July 12, we launched the "Summer Consumption Season" in Chongqing, which is now in full swing. In September, we plan to launch the "Golden Autumn Shopping Festival." Subsequently, there will be the CIFTIS and the CIIE, which everyone is aware of, following one after another. At the local level, we will continue to mobilize the enthusiasm of local governments to initiate tailored and captivating consumption promotion activities in accordance with local conditions, to build a unique "one place, one product" brand and enhance the effectiveness and influence of activities.

Third, we will focus on improving consumption conditions and refining the business system. The business system affects the convenience of consumption, and we will start with both urban and rural areas. In cities, we will cultivate and construct international consumption hubs, revitalizing and elevating pedestrian streets, developing smart shops and business circles, expanding the coverage of "15-minute community life circles," and promoting the development of distinctive neighborhoods. In rural areas, we will implement a three-year plan for county-level commerce, cultivating a batch of leading commercial counties at national level, upgrading and renovating a number of township business centers and establishing new rural convenience stores.

Fourth, we will prioritize innovative consumption scenarios and cultivate consumption hot spots. At present, various new forms and models of the consumer market are flourishing. It is vital to guide innovative development, as laid out in the "three integrations." The first integration involves merging business models. The boundaries between specialty stores, professional stores, shopping malls and supermarkets have become less clear now, and shopping centers now offer diverse elements and functionalities. The second integration revolves around cross-border collaboration. By synergizing business, travel, culture, sports and health, we aim to create more immersive, experiential and interactive consumption scenarios. The third integration focuses on merging online and offline aspects of commerce. We will support the healthy development of "instant retail" and livestream e-commerce to extend and expand into the offline world. This approach aligns with current trends and aims to promote the provision of digital and intelligent services among traditional businesses.

That's all from me. Thank you.

Shou Xiaoli:

Thank you, Mr. Xu for your answers, and thank you to everyone from the press for attending. That's all for today's press conference, goodbye.

Translated and edited by Wang Qian, Wang Yiming, Liu Sitong, Cui Can, Duan Yaying, Yuan Fang, Wang Yanfang, Liu Qiang, Liu Caiyi, Ma Yujia, Li Huiru, David Ball, and Jay Birbeck. In case of any discrepancy between the English and Chinese texts, the Chinese version is deemed to prevail.