Members of the press, good afternoon. Welcome to MOFCOM’s routine press conference. With no announcements to make today, I’d like to take your questions. The floor is open.
Xinhua News Agency: Could you share with us the trade and economic outcomes of President Xi Jinping’s visit to Spain? Besides, he will soon pay state visits to Argentina, Panama, and Portugal and attend the G20 Summit. Could you brief us on China-Portugal trade and economic cooperation?
Gao Feng: President Xi Jinping’s visit to Spain brings historic opportunities for comprehensively deepening China-Spain bilateral trade and economic cooperation. During the visit, the two sides signed an MOU on strengthening third-market cooperation, and agreement on avoiding double taxation and preventing tax evasion and avoidance, a protocol of phytosanitary requirements on the export of Spanish fresh grapes to China and a protocol of sanitary and veterinary requirements on the export of Spanish pork and cured pork products to China, among other intergovernmental cooperation documents. In terms of business cooperation, the two sides signed ten business contracts valued at US$ 17.6 billion in finance, telecommunications, energy, environmental protection, healthcare, machinery and automotive, among others, setting a new record for China-Spain trade and economic cooperation. During the visit, the China-Spain Business Advisory Council was officially established and held the inaugural meeting, which will become another key platform for bilateral commercial cooperation apart from the Mixed Committee of Trade and Economic Cooperation and play a key role in deepening bilateral trade and economic cooperation.
Regarding China-Portugal trade and economic cooperation, bilateral practical cooperation has continued to deepen over recent years, with a series of major outcomes in trade, investment and the joint exploration of third markets.
Bilateral trade continues to grow and has become more balanced. From Jan. to Oct. this year, bilateral trade hit US$ 5 billion, up 8% year-on-year. In breakdown, Chinese exports were US$ 3.1 billion, up 5.5% year-on-year; Chinese imports stood at US$ 1.91 billion, up 12.5% over the same period of last year.
China-Portugal two way investment has increased continuously and become a symbol of mutually beneficial bilateral cooperation. According to Chinese statistics, as of the end of Oct. 2018, Portugal had invested in 255 projects in China, with paid-in capital of US$ 210 million. Chinese businesses had invested over US$ 9 billion in myriads of Portuguese companies in energy, communications equipment, finance, water service, insurance and healthcare. Many of the big projects have yielded good social and economic benefits.
Business cooperation in third markets have shown positive outcomes and become a new highlight in China-Portugal trade and economic cooperation. Chinese and Portuguese companies have jointly tapped markets in South America, Europe and Africa, with success stories of China-Portugal third-market cooperation such as big energy projects in Brazil, Chile, Mozambique and Angola.
China would like to work with Portugal to increase trade exchanges and deepen bilateral and third-market cooperation in energy, finance and infrastructure, so as to bring bilateral trade and economic cooperation to a new high and enrich the substance China-Portugal comprehensive strategic partnership.
Bloomberg: I have two questions. First, according to a Wall Street Journal report last week, China’s negotiating objective is not to have new tariffs. Is it true? What is China’s potential position in the upcoming talks in Argentina? Second, regarding President Trump’s suggestion for more tariffs on China in the same article, if the G20 meeting ends without a deal, USTR Ambassador Lighthizer mentioned equalized treatment for Chinese auto exports, which probably means more tariffs. Do you think it is a threat to China? What’s your comment?
Gao Feng: Both questions concern China-US trade and economic relations and consultations. I’d like to give a response in package. China emphasizes repeatedly that China-US trade and economic cooperation is mutually beneficial and win-win by nature. The two presidents agreed at a telephone conversation not long ago to push China-US trade and economic issues towards a solution acceptable to both sides. At present, the economic teams of both sides have stayed engaged to follow up on the consensus of the two presidents. It is hoped that the US can pull in the same direction as China for a positive outcome of the summit. Thank you.
21st Century Business Herald: A report the WTO recently issued indicates that G20 members applied 40 new trade restrictive measures between May and October, covering around USD 481 billion of trade, more than six times larger than that recorded in the previous reporting period. Three-quarters of the latest trade restrictions were tariff hikes, many of them retaliation to steel and aluminum tariffs imposed by the United States in March. What’s MOFCOM’s comment?
Gao Feng: We’ve noted the WTO report. China always believes that economic globalization is the big trend and global free trade order and the multilateral trading system should be upheld effectively. Though international trade is facing challenges of trade protectionism and unilateralism, China still hopes to work with all economies to build an open world economy that is innovative and inclusive.
Countries belonging to the G20 group, a major forum for international economic cooperation, represent 86% of global GDP and nearly 80% of world trade. We hope to work together with other members to continue with candid, in-depth and constructive dialogues on international trade and other topics in a spirit of cohesion and action, push for positive outcomes, and give a new lease of life into sustained growth in global economy and trade under new circumstances.
Yicai: On November 22nd, China, the US and other relevant WTO members submitted to the WTO joint proposals on the reform of the WTO's the Appellate Body of the dispute settlement mechanism, and planned to issue a joint declaration at the General Council meeting on December 12th. What documents constitute the foundation for the joint declaration, and does the reform proposal on WTO reform and transparency proposal have something to do with the declaration? Does China believe that the joint declaration can best represent opinions and views of the majority of WTO members? What is the feedback on the proposals?
Gao Feng: As you said, the EU, China and other relevant WTO members submitted two joint proposals on the reform of the appellate procedures and planned to issue a joint declaration at the General Council meeting on December 12th. The move is to safeguard the multilateral trading system, uphold and improve the dispute settlement mechanism.
The first proposal responds to certain member’s concern over procedures of the Appellate Body, proposing a suitable solution to issues including transitional rules for outgoing AB members. The second proposal aims to strengthen independence of the Appellate Body, enhance the efficiency and ability of the Appellate Body’s reports, and automatically launch selecion procedures of AB members.
The two proposals aim to respond and address certain member’s concern over Appellate Body procedures, uphold and reinforce the independence and impartiality of the Appellate Body, and start selecting AB members as soon as possible. The joint proposals have been signed by 40 members, including China, the EU, Canada, India, Norway, New Zealand, Switzerland, Australia, Korea, Iceland, Singapore, Mexico and others. The proposals have broad representation as many of these members are major users of the dispute settlement mechanism, including developed and developing members.
The dispute settlement mechanism is the central pillar of the WTO and plays an important role in maintaining the reliability and predictability of the multilateral trading system, solving trade disputes between members in a short period of time and ensuring its effective functioning. The Appellate Body is an important part of the WTO dispute settlement mechanism. Obstruction from certain member for selecing members on the Appellate Body severely threatens the normal operation of the dispute settlement mechanism, posing institutional risks for the normal functioning of the multilateral trading system.
China is willing to work together with all other WTO members to hold active discussions to launch the process of selecting Appellate Body members as soon as possible, jointly safeguard the normal operation of the dispute settlement mechanism and protect the authority and efficacy of the multilateral trading system.
China News Agency: As the G20 Summit approaches, what are China’s expectations for the outcomes in trade and economic areas?
Gao Feng: In the past decade, the G20 has played a critical role in global economic governance. The Hangzhou Summit 2016 witnessed its successful transition from a mechanism for crisis response to one for long-term governance. Currently, trade and investment mechanism has become an important pillar for G20 cooperation.
Facing the growing economic risks and challenges, especially the uncertainties arising from protectionism and unilateralism, collective response is all the more imperative. China is willing to work with the presidency Argentina and other parties to step up cooperation in trade and investment, keep an open market, and unleash new drivers for growth. We will deepen development cooperation, prioritize the implementation of the 2030 Agenda for Sustainable Development, help other developing countries share the benefits of globalization, and jointly promote inclusive and sustainable development. We will further foster consensus to safeguard the multilateral trading system and free trade.
China looks to all parties for concerted efforts to deliver positive and pragmatic outcomes in the commercial area, so that we contribute to an innovative, inclusive and open global economy and sustained economic development in the world. Thank you.
CRI: President Xi Jinping is visiting Latin America recently. Could you please share with us the trade and economic cooperation between China and Latin America?
Gao Feng: Latin America is a natural extension of the 21st Century Maritime Silk Road. In recent years, the commercial cooperation between China and LAC countries has developed across the board, expanded in size and scope, and yielded rich results in trade, investment, and project contracting. China has become the second largest trading partner of Latin America, while Latin America has become the second largest destination for China’s outbound investment, second only to Asia. In 2017, the bilateral trade volume between China and LAC countries reached USD257.8 billion, up by 18.8% year on year. In the first nine months of this year, the bilateral trade volume grew by 20% year on year to USD228.6 billion. By 2017, the stock of FDI from Chines companies in Latin America had reached USD387 billion. The project contracting had totaled USD164.2 billion and the turnover had reached USD112.9 billion.
China and Latin American countries are highly complementary economically, representing huge potential in trade and economic cooperation. China has long been optimistic about the prospect of Latin American and is fully confident of our commercial cooperation. We are willing to work with Latin American countries under the Belt and Road framework and take China-LAC commercial cooperation to new heights. Thank you.
Shanghai Securities News: In the 12th China-Japan Comprehensive Forum on Energy Conservation and Environmental Protection, Qian Keming, Vice-Minister of Commerce said that we would advance the alignment of the green development strategies of China and Japan. What are the plans and measures of MOFCOM in advancing green cooperation between China and Japan?
Gao Feng: Energy conservation and environmental cooperation are important areas for business cooperation between China and Japan, which are highly complementary in such areas, with attractive cooperation prospects. Advancing green cooperation between China and Japan is not only beneficial to the two countries, but also helpful for solving global environmental issues. China stands ready to work with Japan in the following areas for bilateral green cooperation. First, enhancing policy communication and coordination and integrate green development thinking into bilateral business cooperation for the alignment of the green development strategies of China and Japan. Second, strengthening innovative cooperation in new energy, smart city, ecological improvement and green building between China and Japan. Third, encouraging companies of the two countries to leverage their complementary advantages and integrating green cooperation into connectivity, industrial development and infrastructure in third-party markets so as to share the dividends of green economy with the world. Fourth, encouraging more social players to offer relevant funding support for energy conservation and environmental cooperation between China and Japan. China stands ready to enhance communication and coordination with Japan and guide relevant economic groups and trade promotion agencies to follow up and implement green cooperation projects. We hope that China and Japan could jointly explore a green development path and usher in a new era of green cooperation, pushing China-Japan green cooperation towards higher standard, higher quality and a more sustainable direction.
Central Station for Radio and Television: In a previous press conference hosted by the Information Office of the State Council, the head of Department of Foreign Investment Administration, MOFCOM, said that they would go through all the regulations, rules and normative documents and annul or revise the ones that are not consistent with existing opening up policies. It will be very heavy work. Have we started it yet and what areas are involved? In addition, we have also proposed speeding up the unification of laws and regulations on domestic and foreign investments and the introduction of basic laws on foreign investment. What is the role and significance of this basic law to the growth of foreign investment?
Gao Feng: At present, MOFCOM is working with the National Development and Reform Commission and the Ministry of Justice to go through relevant regulations, rules and normative documents. We will work with relevant departments to look into regulations, rules and normative documents related to opening up. This may involve a lot of areas and we will annul or revise the documents as necessary. The work will be completed by the end of 2019.
As for your second question, since reform and opening up, China has made constant efforts to improve its environment for foreign investment. A recent World Bank report has shown that the ranking of China’s business environment jumped to 46th in the world, a large increase of 32 notches from that of last year.
There is no best environment for investment as there is always room for improvement. Formulating basic laws on foreign investment and unifying laws and regulations on domestic and foreign investments will further promote China’s opening up and optimize China’s market- and law-based and international-oriented investment and business environment, providing stronger legal protection for the operation of foreign companies in China. We will continue to support the legislation and deliberation work to introduce relevant laws at an early date. Thank you.
AFP: Is China worried that after this round of trade negotiation is concluded, the US will start the next round of tariff hike soon?
Gao Feng: I have already answered this question. We hope that the US could work with China towards the same goal and strive for positive outcomes of this leaders’ meeting. Thank you.
This concludes today’s press conference. Thank you all.
