Gao Feng: Friends from the press,
Good afternoon. Welcome to MOFCOM鈥檚 regular press conference online. Today I have no information to release on our own initiative. I鈥檓 ready to take your questions. The floor is open.
Nihon Keizai Shimbun: The trade statistics of May this year have been published, with export statistics better than expected. What鈥檚 your reading of the current trade situation?
Gao Feng: According to customs statistics, China鈥檚 export denominated in RMB yuan in May grew by 1.4%, mainly as a result of the progress in China鈥檚 COVID-19 prevention and control and orderly resumption of work and production. Earlier, the State Council introduced a host of policies and measures to stabilize foreign trade, which have been fully implemented by all localities and government departments, and are now taking effect.
As we speak, the evolving global pandemic is still challenging. It will take some time to see market demand recover. There are still a number of trade uncertainties. Going forward, we will follow the decisions and plans of the CPC Central Committee and the State Council, make solid efforts to fulfill the tasks of stabilizing foreign trade and protecting market entities, support exporters in expanding domestic market for their saleable exports, help exporters secure market, clients and orders, and safeguard the stability of industrial and supply chains. We will spare no effort in fulfilling this year鈥檚 targets and tasks of ensuring stable and higher-quality import and export. Thank you.
China Business News: According to customs statistics, China鈥檚 export to the US declined by 11.4% in the first five months of this year, cutting its trade surplus with the US by 14.5%. China鈥檚 trade with the EU and Japan also dropped, but its total trade with ASEAN increased. What鈥檚 MOFCOM鈥檚 comment on this? How to steadily improve industrial and supply chains in the region?
Gao Feng: In the first five months of this year, China鈥檚 trade with ASEAN stood at 1.7 trillion yuan, up by 4.2% year on year. China鈥檚 export to ASEAN stood at 936.62 billion yuan, up by 2.8%, and its import from ASEAN stood at 759.86 billion yuan, up by 6%, both higher than the overall growth rate of China鈥檚 import and export over the same period. ASEAN has become China鈥檚 largest trading partner, which speaks volumes about the potential and resilience of trade between China and ASEAN member states.
China and ASEAN enjoy strong economic complementarity. Over the years, countries involved have leveraged their strengths and kept on deepening regional economic cooperation. In particular, since the establishment of China-ASEAN FTA, the two sides have kept on opening markets, promoting trade and investment liberalization and facilitation, and deepening cooperation in industrial chains and supply chains.
China is willing to bolster cooperation with ASEAN in trade, investment and other economic areas. Regional free trade arrangements should be fully utilized to support businesses in expanding trade flows and two-way investment, and jointly ensure the stability, security and prosperity of regional industrial chains and supply chains. Thank you.
MNI: I have two questions. First, could you explain to us why China鈥檚 crude oil and soybean imports surged by 21% and 28% last month amid the bigger picture of sluggish overall import? Second, passenger cars sales grew for the first time in May over the past 11 months. Is it seasonal growth due to the May Day holiday, or does it mean auto consumption is experiencing a V-shape recovery? Will the strong performance in May be sustained?
Gao Feng: Regarding your first question, customs statistics show that China鈥檚 crude oil and soybean imports grew by 5.2% and 6.8% in the first five months this year. In May, the growth was 19.3% and 27.7%. This is market-driven import by Chinese companies in light of international market dynamics and domestic demand. The increase in soybean import can also be explained by the depreciation of Brazilian Real and Brazil鈥檚 strong will to export. Against the mounting pressure of global economic downturn, Chinese companies actively expanding imports will help to lift confidence in global economic development.
On your second question, as the domestic epidemic prevention and control continue to improve, China's automobile consumption market is warming up. According to relevant statistics, the national passenger car sales in May was 1.609 million, up 12.6% month on month and 1.8% year on year, an increase of nearly 80 percentage points from February, achieving the first positive year on year growth in 11 months. This shows that the policy of stabilizing and expanding automobile consumption by central and local governments has gradually shown its effect. Automobile enterprises have speeded up their resumption of work and production. Residents鈥 consumption confidence has been strengthened. The demand for automobile has been effectively released and has recovered.
China's automobile market has great development space and potential, and the demand for automobile is still strong. With the full restoration of the domestic production and living order and the further effects of various relief policies for companies, China's automobile consumption market will still maintain a steady recovery. Thank you!
China News Service: Recently, Australia announced that it would amend its foreign investment law to strengthen its national security review, which is the largest reform of this law in 40 years. Some people think that this move may have a negative impact on China's investment in Australia. What is the Ministry of Commerce鈥檚 take on this?
Gao Feng: We have noticed that Australia has recently announced reforms to its foreign investment review framework and plans to release the draft legislation in July. China follows it closely and will evaluate its impact.
China encourages qualified Chinese enterprises to invest in Australia according to laws and regulations and in compliance with market rules and international practices. Chinese enterprises investing in Australia have made great contributions to local economic and social development. It is hoped that the Australian government will adopt an open and pragmatic investment policy, strengthen communication with foreign investors, maintain transparency and continuity of relevant policies, create a fair and non-discriminatory investment environment for foreign investors, and protect the legitimate rights and interests of all foreign investors, including Chinese enterprises. Thank you!
Economic Daily: We鈥檝e noticed that the Ministry of Commerce, Ministry of Human Resources and Social Security, the State Council Leading Group Office of Poverty Alleviation and Development, together with other seven central departments, issued a notice on consolidating and expanding the efforts to alleviate poverty via domestic services. What are the background and objectives of this notice? What initiatives does it include?
Gao Feng: We are committed to bring to completion the building of a moderately prosperous society in all respects and win the battle against poverty this year. In order to blunt the impact of COVID-19, we need to improve the policies on poverty reduction through domestic services, put more people in poverty to work in the life service industry and give full play to the role of domestic services in winning the battle against poverty. To this end, ten agencies including MOFCOM, MHRSS, and CPAD unveiled the measures to further consolidate and expand the work of poverty alleviation through domestic services.
There are more than 20 support measures.
Training. A series of training such as Chunchao Action aimed to improve the skill of domestic services will be provided for poor workforce. Programs on integration of production and education, collaboration of colleges and enterprises, among others will be supported. Relevant training textbooks will be complied and provided for poverty-stricken areas through such channels as Farm Libraries free of charge. Industry associations and big companies are encouraged to conduct certification and accreditation on vocational skills and make publicly available information inquiry for such certificates.
Fiscal support. Budgetary investment and relevant fiscal support will be channeled into the building of community-based home services stations. Micro, small and medium-sized domestic services enterprises and their employees can enjoy premium refund up to 100% of their unemployment insurance contribution paid in the previous year, as well as subsidies for training, employment, entrepreneurship, transport and daily expenditures, among others.
Financial support. Financial institutions are encouraged to lend to domestic services enterprises engaged in poverty alleviation, and develop commercial insurance products related to domestic services. Localities where conditions permit will provide subsidies for domestic service companies and workers to buy insurance.
Next, we鈥檒l work with relevant ministries to put these policies into practice and contribute more to building a moderately prosperous society in all respects and winning the battle against poverty. Thank you.
Gao Feng: This is the end of today鈥檚 press conference. Thank you all.