Gao Feng: Friends from the press, good afternoon. Welcome to MOFCOM’s regular press conference. Before I take your questions, I have an announcement to make.
Gao Feng: The announcement is about the development of rural e-commerce in poverty-stricken counties designated by the central government in the first three quarters of this year.
According to the statistics of the third party entrusted by MOFCOM, from January to September this year, e-commerce sales of 832 poverty-stricken counties designated by the central government hit RMB206.88 billion, up by 24.1% year-on-year, 5.2 percentage points higher than the first half of this year. Major indicators get better and better with still stronger momentum of growth. There are mainly four features.
First, overall development of e-commerce has recovered to pre-pandemic level. In the third quarter, online retail sales of 832 poverty-stricken counties designated by the central government registered a YOY growth of 34.5%, 1.9 percentage points higher than the whole-year growth rate in 2019. In the first three quarters this year, online retail sales of tangible goods grew by 50.9% YOY to RMB122.32 billion, more than the whole-year online sales of goods in 2019; online services retail sales dropped 1.3% YOY to RMB84.56 billion.
Second, e-commerce in tangible goods grew fast. In the first three quarters, online retail sales of major goods saw a relatively rapid growth. The top three best-selling products online are food and healthcare products, home decoration and furniture, apparel and accessories with sales value of RMB61.18 billion, RMB11.48 billion and RMB9.25 billion respectively, up by 74.9%, 27.1% and 8.6% YOY. Online retail sales of pharmaceuticals and medical devices, books, audio and video products, and household goods grew by more than 50% YOY.
Third, e-commerce in services witnessed further recovery. In the first three quarters, consumption of services has rebounded driven by the major achievements in containing the virus and the National Day and Mid-autumn Festival holiday. Online retail sales of tourism services amounted to RMB39.24 billion, a YOY drop of 10.1%, which is 5.4 percentage points lower than the first half of this year. Online retail sales of food and drinks reached RMB34.34 billion, up by 8.1% YOY. Online retail sales of life services grew by 18% YOY to RMB 5.12 billion.
Fourth, e-commerce in agricultural products maintained a sound momentum. In the first three quarters, online retail sales of agricultural products from 832 poverty-stricken counties designated by the central government stood at RMB26.42 billion, up by 48.1% YOY. The top three best-selling products are herbs, fruits and tea, with sales value of RMB6.99 billion, RMB6 billion and RMB4.75 billion respectively. By the end of September, the number of e-commerce companies in poverty-stricken counties designated by the central government had amounted to 3.05 million, increasing by 195,000 or 16.3% from the end of June.
That’s all for the announcement. I’d like to take your questions. The floor is open.
China News Service: In less than a month, the third CIIE will be hosted. How about the preparation for the Expo? What are the new features of this Expo compared with that of last year under long-term epidemic prevention?
Gao Feng: At present, the preparation for the Third CIIE is progressing in an orderly manner according to the plan.
In attracting exhibitors, quality has continued to be improved as the Expo became more specialized, and the exhibition work is making steady progress. Exhibits are shipped from the United States, Italy, Spain, Germany and other parts of the world. After the first batch of exhibits were self-declared upon entry, and cleared through customs on September 28, a large number of exhibits are now going through the entry and customs formalities.
In business promotion, purchasing groups have been formed and are preparing for their participation in accordance with the requirements of long-term epidemic prevention and control. The Import Expo Bureau has held 23 roadshows for business promotion in 19 provinces, autonomous regions and municipalities, joined by more than 1,900 procurement organizations on the spot and more than 500,000 participants online. It will also further align the online and offline supply and demand during and after the expo. It has held five pre-exhibition supply and demand matchmakings, and will continue to hold trade and investment matchmakings during the expo. It has also provided 39 collections of tailored information on more than 780 items of exhibit or service from would-be exhibitors to professional buyers for matchmaking in advance.
In service guarantee, we will accelerate the implementation of support policies for the Expo. At present, a number of support policies have been announced or implemented, including customs clearance facilitation measures for exhibits and preferential tax policies for buyout exhibits. We will continue to optimize document management, information service, catering guarantee, on-site translation and other work, and enhance the sense of gain for exhibitors and merchants.
Under the long-term epidemic prevention and control, the third Expo always puts safety first, adheres to the bottom-line thinking, strengthens epidemic prevention and control measures, and makes great efforts to improve quality. Since July 1 when exhibitions were resumed, the National Exhibition and Convention Center has hosted 30 exhibitions, with a total of over 2 million visitors. Up to now, operations have been stable and in order, and no case of COVID-19 has been reported on-site. We have accumulated on-site experience in epidemic prevention and control, and formulated the Plan for Epidemic Prevention and Control of Exhibition Halls of the Third CIIE in accordance with the Overall Plan for Epidemic Prevention and Control of the Third CIIE, and will make every effort to ensure the health, safety and epidemic prevention of personnel, exhibits and exhibition areas on the site of the Third CIIE.
It is less than three weeks away from the opening of the third Expo. We will make real and detailed preparations in full to make sure that a safe, wonderful and fruitful Expo will be held. Thank you!
Phoenix TV: The CIIE will be opened in less than one month. How are the latest developments this year, including on the exhibitors’ part?
Gao Feng: Since the beginning of this year, we have been coordinating CIIE preparations and COVID-19 response to meet the overall requirement on "continued success" for the expo. Overall, smooth progress has been made in preparing for the business exhibition. We have basically finished our work on exhibitors registration. Businesses from various countries have enthusiastically signed up for the expo. There are the following highlights:
First, a larger exhibition area. The business exhibition of this year's CIIE has six major sections, exhibiting food and agricultural products, automobiles, technology and equipment, consumer goods, medical equipment, pharmaceuticals and health care, as well as trade in services. The size of the exhibition area has exceeded that of last year.
Second, optimized layout of the exhibition. Bearing in mind global hot topics and industrial development trends, we have set up four new zones dedicated to public health and epidemic prevention, energy saving and environmental protection, smart mobility, as well as sports goods and events, which are welcomed by the exhibitors.
Third, higher-quality exhibitors. Fortune 500 companies and leading businesses in different sectors have signed up for the expo enthusiastically. We have as many exhibitors as in previous years, and a number of companies have signed contracts to participate in the CIIE in the next three years. Thank you!
China Business News: From January to August this year, China's trade deficit in services was halved from the same period last year, down to RMB515.62 billion. What are the reasons for this? What’s MOFCOM’s take on the development of trade in services this year?
Gao Feng: Since the beginning of this year, due to the COVID-19 pandemic and multiple other factors, the overall volume of China's trade in services has declined, but the deficit has narrowed, the structure improved, and the proportion of trade in knowledge-intensive services continued to increase.
The main reasons for the significant decline in China’s deficit in trade in services in the first eight months of this year are as follows:
First, the trend in recent years continues. As China’s trade in services becomes more competitive internationally, since 2017, China's services export have registered higher growth rates than its services import, and the deficit in 2019 fell by RMB176 billion compared with the previous year. Since the beginning of this year, despite the impact of COVID-19, this trend has continued, with the decline in services export 21.8 percentage points smaller than that in services import, further narrowing the deficit.
Second, services export shows strong resilience. From January to August this year, China's services export fell 2.2%, a decline smaller than that of the world's major services traders. In particular, export of knowledge-intensive services grew 8.5% against the trend, reaching RMB 692.89 billion, accounting for 56% of total services export, an increase of 5.5 percentage points. Intellectual property royalties, export of telecommunications, computer and information services, as well as insurance services grew fast, up 29.9%, 15.8% and 13.4% respectively.
Third, sharp decrease of tourism import. Tourism is a major part of China’s services import, accounting for over 50% in 2019. This year, due to the COVID-19 pandemic, outbound trip has plummeted. From January to August this year, China’s tourism import dropped by 46.2%, leading to a 24% decrease of total services and, consequently, sharp decrease of services trade deficit. Thank you.
MASTV: Some Portuguese-speaking countries have suffered from COVID-19 to different extents. How will MOFCOM leverage Macao as a platform under the Forum for Economic and Trade Cooperation between China and Portuguese-speaking Countries, to help Portuguese-speaking countries fight the pandemic?
Gao Feng: Since the pandemic broke out, we have utilized the coordination mechanism of the Forum for Economic and Trade Cooperation between China and Portuguese-speaking Countries (Macao) (Forum Macao) to enable the role of Macau as a platform between China and Portuguese-speaking countries and help them respond to the pandemic. With the support of Macao business associations and enterprises, The permanent secretariat of Forum Macao have mobilized funds and supplies, and donated medical supplies to Portuguese-speaking countries. Its work plays a positive part in global collaborative pandemic response, and testifies the deep friendship and shared future between us as we overcome the difficulties together.
Recently, MOFCOM has been working with the government of Macao SAR in supporting the permanent secretariat of Forum Macao, together with China International Contractors Association, to appeal to Chinese companies in Portuguese-speaking countries to continue to provide medical and livelihood assistance locally. The permanent secretariat also shared prevention and control practices, including diagnostic and treatment plans involving traditional Chinese medicine, via video seminars and special training sessions. The permanent secretariat will conduct studies on setting up a cooperation and communication center for epidemic response under Forum Macao, to enhance cooperation in health and epidemic response. It will also hold series events for trade promotion to leverage Macao’s position as a terminal market for foods from Portuguese-speaking countries, so as to increase import from them.
Going forward, we will work with the government of Macao SAR to enable the role of Macau as a platform between China and Portuguese-speaking countries, enhance cooperation in pandemic response and economic development, and build a community with a shared future for mankind. Thank you.
Gao Feng: This is the end of today’s press conference. Thank you.