Dear friends from the media: Good afternoon! Welcome to MOFCOM’s regular news conference. First, I have one announcement to make today.
China’s outbound investment and cooperation for the January-August period of this year
From January to August this year, China’s non-financial ODI stood at RMB480.45 billion (or USD68.48 billion), a year-on-year decline of 2.6%. The value of newly signed foreign contracted projects amounted to RMB946.94 billion (or USD134.97 billion), a year-on-year increase of 7.3%; the accomplished business revenue reached RMB 558.11 billion (or USD79.55 billion), a year-on-year decrease of 10.2%. A total of 183000 laborers were dispatched for foreign labor cooperation. By the end of August, 644000 laborers were working overseas.
The outbound investment for the first eight months of 2020 shared the following features:
First, investment and cooperation in Belt and Road countries made steady headway. From January to August, non-financial ODI in Belt and Road countries by Chinese companies increased by 31.5% y/y to USD11.8 billion, accounting for 17.2% of the total amount in the same period (up by 4.8 percentage points from the previous year). The value of newly signed foreign contracted projects with Belt and Road countries stood at USD72.95 billion (accounting for 54% of the total contractual value of the same period) with USD46.02 billion of accomplished revenue (accounting for 57.9% of the total accomplished revenue of the same period).
Second, outbound investment by local enterprises expanded. From January to August, non-financial ODI by local companies grew by 5.1% y/y to USD49.27 billion, taking up 71.9% of the total ODI for the same period. The ODI by provinces and cities along the Yangtze River Economic Belt rose to USD22.05 billion, a y/y increase of 13.1%.
Third, more large foreign contracted projects were signed. From January to August, 462 projects with contractual value over USD 50 million each were signed, totaling USD11.145 billion and accounting for 82.6% of the total contractual value. Among them, 265 projects were worth more than USD 100 million each, 7 projects more than the previous year.
Fourth, some industries trended positively in foreign contracted projects. The January-August period saw rapid growth of the value of newly signed contracts in certain areas. To be specific, the contractual value of general construction rose by 41.9% y/y to USD34.15 billion, petrochemical projects rose by 36.2% y/y to USD11.63 billion, and water conservancy projects rose by 73.2% y/y to USD3.62 billion.
With no further information to announce, I’d like to take your questions.
The floor is open.
Hong Kong Commercial Daily: The leaders of China and the EU confirmed that the two sides would speed up the investment agreement negotiations to fulfill the target of concluding the negotiations by the end of this year. Could you introduce the progress of the negotiations and the outstanding issues to be resolved? Will the talks be concluded by this year?
At the China-Germany-EU leaders' meeting on September 14, the leaders reaffirmed they would speed up the investment agreement negotiations between China and the EU to conclude the negotiations this year. This demonstrates the two sides’ strong commitment to the negotiations and firm confidence in the early conclusion of a high-level agreement.
Since the beginning of this year, China and the European Union have overcome the impact of the pandemic and accelerated the pace of negotiations. Six rounds of formal negotiations have been held with positive progress made in negotiations on the text and list. At the 8th China-EU High-Level Economic and Trade Dialogue, which was held before the China-Germany-EU leaders’ meeting, the two sides confirmed that significant progress had been made on the issue of fair competition. This also means that the overall negotiation process has taken a big step forward.
China and the EU have made plans for the next round of negotiations in accordance with the important consensus reached by the leaders. The 32nd round of negotiations will be held next week. Going forward, the two sides will build on the good momentum of the negotiations, focus on the remaining issues of the text and market access, and explore solutions in an active and pragmatic manner so as to benefit enterprises and investors of both sides at an early date. Thank you!
Economic Information Daily: According to German media reports, Germany’s exports to China totaled nearly 23 billion euros from April to June, and its quarterly exports to China exceeded those to the U.S. and other countries for the first time, making German exporters more dependent on Chinese business than ever before. What does the Ministry of Commerce make of it?
Gao Feng: China and Germany have long been each other’s most important trading partners in their respective regions. According to German statistics, since 2016, China has become Germany's largest trading partner in the world. In the second quarter of this year, China became Germany's largest export market.
The rapid expansion of Sino-German trade is attributed to not only the sound bilateral relations and their economic complementarity, but also China’s continuous drive towards further opening up. What makes China-Germany trade what it is today is win-win cooperation between enterprises of the two countries in accordance with market-oriented principles and WTO rules, which meets the market demand of both sides.
Since the outbreak of the COVID-19 pandemic, China and Germany have actively worked together to ensure medical supplies, strengthen macroeconomic policy coordination, facilitate cross-border flows of people and goods, creating favorable conditions for the smooth development of bilateral trade. On the evening of September 14, leaders of China, Germany and the EU held a video conference, charting the course for the development of China-EU relations in the next stage. We are willing to work together with Germany to implement the important consensus reached by the leaders, push forward the upgrading of China-Germany and China-EU economic and trade cooperation, create more development opportunities and inject new impetus into the global economic recovery. Thank you!
National Business Daily: The National Consumption Promotion Month 2020 started on September 9, 2020. How many enterprises have participated in the event? With the National Day and Mid-Autumn Festival around the corner, what policy benefits can consumers enjoy during the Consumption Promotion Month?
Gao Feng: The National Consumption Promotion Month 2020 has received a positive response from localities and enterprises. 179 key cities and more than 100,000 enterprises in all provinces, autonomous regions and municipalities across the country actively participate in the promotion activities, involving more than two million physical stores and online shops. According to preliminary statistics, as of 16 September, more than 1,400 featured consumption promotion activities had been launched across the country.
During the consumption promotion month, local governments, key enterprises and financial institutions will offer a series of tailor-made preferential promotion policies, which mainly focus on five areas: First, special promotion for festivals and holidays. Many large-scale e-commerce platforms will launch promotion activities, such as festival coupons and Mid-Autumn Food Festivals during the Mid-Autumn Festival and the National Day, and some platforms will also organize special promotions for poverty alleviation. Second, issuing vouchers on a large scale. Some communication operators will issue 5G vouchers on a large scale, and many e-commerce shopping and payment platforms plan to offer tens of billions of cash vouchers and shopping allowance. Third, banks and businesses will jointly carry out activities to benefit the people. China UnionPay will work with local governments to issue RMB 1 billion worth of vouchers, and cooperate with financial institutions and brand businesses to help local governments boost sales through vouchers. Some major domestic commercial banks will introduce preferential policies such as vouchers for credit card spending. Fourth, give full play to the advantages of the platform for promotion. Some e-commerce platforms will provide free green channels for enterprises transferring products intended for export to domestic sales, and many e-commerce enterprises will carry out promotion activities to alleviate poverty and help farmers by consumption, and publicize time-honored brands in various ways such as online marketing and special events. Fifth, advocate the new concept of consumption. Some key online ordering platforms are actively publicizing and promoting "smaller dishes" or "zero food waste" campaigns to reduce the waste of food and ingredients. Some ride-hailing platforms will provide tailor-made travel discounts to promote low-carbon travel. Many e-commerce companies will also provide subsidies to encourage the public to trade old products with green smart ones and so on.
In addition, during the Mid-Autumn Festival and National Day holidays, major participating enterprises in various localities will also organize more than 1,300 consumption promotion activities involving upstream and downstream enterprises, production, supply and marketing enterprises, and domestic and foreign trade enterprises. The themes of such events include transferring products intended for export to domestic sales, time-honored brands, domestic fashion brands, poverty alleviation through the sales of agricultural products, etc., so that consumers can effectively enjoy discounts and benefits. Thank you!
Securities Times: Under sluggish global investment, from January to August, the foreign investment in China in RMB achieved positive growth. What is the view of the Ministry of Commerce on this? How does the Ministry of Commerce view the current trends on keeping foreign investment stable?
Gao Feng: In the first eight months of this year, the paid-in foreign investment in China was RMB 619.78 billion, up 2.6% year-on-year. In August, the paid-in foreign investment in China was RMB 84.13 billion, an increase of 18.7% year-on-year. The amount of foreign investment absorbed in a single month has increased for the fifth consecutive month.
At present, the global cross-border direct investment is still in a serious downturn, while China's paid-in foreign investment has achieved growth against such trend, which represent hard-won achievements. This is because that the CPC Central Committee and the State Council attach great importance to the work of keeping foreign investment stable, and have introduced a series of policies and measures to do so, thus China's business environment has continued to be improved. In addition, it fully shows that China's economy has strong resilience and great potential, and its attraction to foreign investment never abates. In the next step, we will continue to strive to create a market-oriented, law-based and internationalized business environment, continuously improve services for foreign enterprises and foreign investors, and continuously increase the level of market access, so that global investors can all share the development opportunities in China and achieve mutual benefits and win-win results. Thank you!
MNI: Some experts propose that as RMB is getting stronger with a widening spread compared with other major currencies, China should, while attracting foreign investment, push for two-way capital account openness to increase and improve China’s outbound investment. What’s your comment? How do you view the opportunities and risks for Chinese enterprises going abroad amid this pandemic? And how has China’s outbound investment been faring against rising trends of anti-globalism and protectionism?
Gao Feng: China’s position has been consistent on Chinese enterprises’ outbound investment and international cooperation. Although the pandemic is still spreading around the world, world economic growth is weak, international trade and investment has severely contracted, and unilateralism and trade protectionism are on the rise, all translating into uncertainties and destabilizing factors, enhancing cooperation on development remains a shared commitment for all countries in the long run.
By far, China have made major strategic achievements in our response to COVID-19. The national economy is recovering on a steady trajectory. As businesses resume operation and production, they are very much willing to, and are well prepared for, outbound investment and international cooperation.
The Chinese government will continue to support Chinese enterprises in outbound investment and international cooperation in accordance with internationally accepted rules. We will work with relevant countries and enterprises to strive for mutual benefit, win-win outcomes and common development, and reinvigorate world economic recovery. Thank you.
Shanghai Securities News: Now that the public comments about the 2020 Catalogue of Industries for Encouraging Foreign Investment have been collected as planned, when will MOFCOM publish this Catalogue? In which areas will opening-up be further expanded?
Gao Feng: The collection of public comments about the draft 2020 Catalogue of Industries for Encouraging Foreign Investment was concluded on August 30. The public paid great attention to this amendment, and submitted many valuable opinions. Now, MOFCOM is working on the comments with the National Development and Reform Commission. We will accelerate the implementation and publish it as soon as possible. Thank you.
China News Service: As the 128th Canton Fair is to be held “in the cloud” next month, could you share some updates on the exhibitors and buyers? After the last session, what will this session of Canton Fair feature in terms of exhibition, negotiation, and transaction?
Gao Feng: The promotion of the 128th session of Canton Fair is underway.
In organizing exhibitions, this Canton Fair still features 50 sections under 16 categories, and all content will go online at the same time. The cross-border e-commerce section will also be set up at this session to promote the comprehensive pilot zones for cross-border e-commerce. It will work with B2B cross-border e-commerce platforms to benefit more enterprises.
In inviting buyers, this canton fair will step up efforts and expand the scope. It will launch series events globally, including “cloud promotion”, “cloud invitation” and “cloud contract signing”, and continue to promote itself through internationally famous social media services and search engines, so as to attract more buyers to attend this session.
In building the platform, this session will focus on optimizing the platform’s functionalities, including improved experience for buyers, better search and display results, and more efficient matchmaking between suppliers and buyers. Using cloud technologies and other innovative measures, this session will enable participants to browse information about exhibitors and their exhibits, advertise their products via live streaming, communicate with each other real-time, make reservations for negotiation, and match with potential trading partners. Thank you.
Gao Feng: This is the end of today’s press conference. Thank you.