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Press conference of the Shanghai Municipal Government

Feb 20, 2017

Xiao Guiyu: Good afternoon friends from the media. At the closing of the 5th session of the 14th Shanghai People’s Congress, we have gathered here for a press conference. And we are glad to say that we have invited newly-elected mayor Ying Yong to answer your questions. I now request mayor Ying Yong to say a few words.

Dear reporters, good afternoon! I’m glad to meet you. We have successfully concluded the lawmakers and political advisors conventions this year. I would like to express my gratitude to all our media friends. Thank you for reporting on the two conventions in a timely and comprehensive manner for our citizens. Thank you for your hard work!

The 5th session of the 14th Shanghai People’s Congress elected me as mayor of the Shanghai Municipal People’s Government and I made a speech about my new position at the closing ceremony. I won’t say too much now so as to spare more time for reporters. I will now take your questions.

People’s Daily: Shanghai’s economic performance in the last two years showed some recovery in the background of a sluggish global economy. What’s your expectation for this year’s performance and what industries will become Shanghai’s new economic growth points?

Ying Yong: Shanghai has maintained a healthy and stable economic development in recent years, better than our expectations, as was shown by last year’s major economic indexes released by the National Statistics Bureau this morning. Shanghai’s GDP growth was 6.8% last year. The general public budget revenues increased by 16.1% and 599,000 new jobs were created. The expenditure on research and development represented 3.8% of the city’s GDP. Disposable incomes of urban and suburban residents grew 8.9% and 10%, respectively, quicker than the economic growth for years. And the income growth of suburban residents has surpassed that of urban residents for eight successive years.

We expect this year’s GDP growth rate to be around 6.5% after taking into account various factors and Shanghai’s economic development. We have also set active and proper targets for fiscal revenue and new jobs. We will work hard to fulfill these tasks.

To achieve high-quality and sustainable economic growth, we will adhere to the new development concept and continue to push forward supply-side reforms and opening up. We will focus on the Shanghai free trade zone and the construction of the sci-tech center, cultivating emerging industries and improving traditional industries while working on economic restructuring. We have done a lot to promote emerging industries in recent years. The industries of new energy, new energy automobiles, new display and medical equipment all achieved double-digit growth rates, with some even surpassing 20%. These new industries will be Shanghai’s new economic growth points. We will take measures to encourage effective investment, upgrade consumption and stabilize foreign trade. We are fully confident in Shanghai’s economic development.

Xinhua News Agency: The Shanghai free trade zone has been in operation for three years. Now that 11 provinces and cities have set up free trade zones, how will Shanghai’s free trade zone retain its characteristics and advantages? What will be the focus of the next steps?

Ying Yong: Establishing the Shanghai free trade zone was a key strategy of the central government. The free trade zone has made achievements as expected in the past three years under the direct leadership of the central government and with the help of relevant ministries and national departments. More than 100 innovative systems of the Shanghai free trade zone have been duplicated nationwide over the past three years. More than 200,000 enterprises were newly registered in the free trade zone, more than the total company number registered in the area in over 20 years before the zone was established. The free trade zone, accounting for only 2% of the city’s area, contributed one fourth of the city’s GDP. President Xi Jinping and Premier Li Keqiang spoke highly of the achievements of the Shanghai free trade zone recently and set definite heightened requirements for its further development.

We are now drafting the zone’s working scheme for the next step. We will deepen reforms in investment management, facilitating trade, serving the “One Belt, One Road” strategy and comprehensive supervision to obtain a more innovative system.

The Shanghai free trade zone will strengthen coordination in the construction of Shanghai as an international financial center, and in the construction of the sci-tech center with global influence and Pudong New Area, which is looking to improve its governance ability.

Bloomberg: As a large amount of capital flew out this year, some reform measures about the free flow of capital accounts in the free trade zone were suspended. When will you resume the measures and what new financial measures will you adopt this year?

It is a national strategy to build Shanghai into an international financial center by 2020 that goes with the state’s economic power and the international status of the RMB. We will take advantage of the free trade zone to test innovative financial measures, that is, to implement the 40 measures approved by the State Council. We didn’t suspend any of the measures. We have made five detailed rules in fields of foreign exchange management reform, market entry for banking institutions and comprehensive supervision and issued the first free trade zone bond. The Shanghai Insurance Exchange, the Shanghai Commercial Paper Exchange and China Trust Registration Corp were founded in the FTZ.

Nearly 20,000 FT accounts were added last year, making up a total of 63,000. By the end of last year, we had made cross-border settlement worth more than 1 billion yuan. Enterprises got a total of over 800 billion yuan in capital through FT accounts and had no risks.

We will continue to implement the 40 measures under the guidance of the national financial supervisory institutions. We will try to extend the FT accounts to sci-tech companies outside the free trade zone, explore the negative list management mode in the financial industry and push forward construction of the financial market. Risk control will always be carried out during the innovation process to prevent any regional or systemic financial risks.

Dragon TV: There are two highlights of the medical reform in the government report. One is to disconnect doctors’ payment with drug sales and call off drug price rise in hospitals. As the drug price rise has been abolished in community health centers, do you have a schedule for the implementation in public hospitals? What measures will benefit the people? The other highlight is to improve the family doctor system and promote the hierarchical medical system. What’s the effect of the pilot trial and how will you improve the systems?

Ying Yong: We have stepped up medical reforms since Shanghai was named a national pilot city for comprehensive medical reforms last year. Drug price rise will be abolished in all the city’s public hospitals this year. We have strengthened construction of community health centers, improved the capability of community doctors, distributed more medicines to community health centers and raised the medical insurance reimbursement rate at grass-roots hospitals.

More than 10 million citizens have had their own family doctors since the city started the family doctor system in 2011. We will continue to extend the system and improve capability of family doctors so that more citizens can enjoy better family doctor service.

We will extend the medical insurance to cover more medicines for critical diseases while equalizing the medical insurance benefits for urban and suburban residents. We included more than 20 tumor molecular targeted medicines into the medical insurance system recently. But some hospitals haven’t stocked these medicines and some patients haven’t got the reimbursement. The government has noticed this problem and will solve it as soon as possible. Government departments will pay more attention to effective coordination when issuing similar public service policies in the future.

We also allow employees to buy commercial medical insurance with the balance in their personal medical insurance account. We will continue to deepen medical reforms and promote the construction of a “healthy Shanghai”.

Lianhe Zaobao: China adopted some foreign exchange monitoring measures when the RMB faced depreciation pressure. Since money of local and even Chinese middle-class families can’t flow abroad, will it cause indirect pressure on Shanghai’s real estate prices? This year’s government work report said the government will continue to control the real estate market. Some people suggest adding land supply in addition to purchase and loan restrictions. How will Shanghai increase land supply, especially in the urban area, and prevent new land lots from setting auction records?

Ying Yong: The Shanghai government has been paying close attention to the real estate market. Property prices in Shanghai are too high and go up too quickly. We don’t want to see too high property prices which will hinder us in attracting talents and affect the city’s vitality, innovation and long-term development. We have adopted a series of measures to control and adjust the real estate market and the effects are being revealed gradually.

We will continue to control the real estate market and push forward the stable and healthy development of the real estate market with administrative, economic and legal means. At the same time, we will also improve the budget housing system. The government will build 50,000 new budget apartments of all kinds and renovate 480,000 square meters of old houses in the urban area and 44,000 square meters of old suburban communities this year.

We will guarantee supply of “talent” houses and strictly supervise property agencies to prevent property speculation and publicizing of false information.

Relevant government departments stopped project approval and suspended presale and sale of apartment-style office buildings recently. These apartment-style office buildings are different from residential houses in land status, tenure of use, utility prices, residence registration, children’s schooling and tax payment.

Apartment-style office buildings have caused disorder in the real estate market and raised prices of land for industrial and commercial use. The government is now drafting instructions and policies to solve the problem.

Jiefang Daily (Shanghai Observer): The new regulations for the car-hailing business issued by Shanghai at the end of last year aroused much controversy. Some said the new regulations were too conservative while others worried that the new regulations will further raise the auction price of Shanghai plates. What’s your opinion on this? There are rumors that Shanghai will announce new measures to further tighten restrictions on vehicles without Shanghai plates in April. Is it true? Bike sharing was a hot topic at this year’s sessions of the Shanghai People’s Congress and the CPPCC Shanghai Committee, getting support as well as opposition. What’s your view on the prospects of bike sharing?

Ying Yong: We will foster a safe, legal and orderly development of the car-pooling service according to the law. The new regulations on car-hailing service are fit for Shanghai and should be implemented well.

According to my knowledge, the number of bidders, the rate of winning the bid, and plate auction prices have all been stable in recent months. About 220,000 to 230,000 people joined the bidding every time, with around 5.4 percent of them winning the bid at an average price of 88,000 yuan.

And I can confirm with you that we won’t carry out stricter measures to restrict vehicles without local plates in April.

The rapid development of the bike-sharing service has attracted attention from both society and the government. The bike-sharing scheme is environment friendly and is convenient for people but some riders violated relevant regulations on riding and parking. The relevant government department is drafting a guideline to foster a legal and orderly development of bike sharing, encourage the companies to improve self-discipline and management and guide riders to use the bikes in a civilized way.

CCTV: It has been three years since the foundation for the Shanghai Technology Innovation Center was laid. What progress has been made? Last September, an upgraded version of 30 policies for talents was announced, yet social response suggests limited attraction in bringing talents to Shanghai. What further measures will be implemented?

Ying Yong: The call to build a technology innovation center with global influence was made by President Xi Jinping, and, as such, it is a significant responsibility that Shanghai shoulders for the country’s development. It has been placed high on the national agenda. The state administration has assigned officials from the State Council to lead the center’s construction as well as that of the Zhangjiang Comprehensive National Science Center. Leaders from the National Development and Reform Commission and the Shanghai Municipal Government are also involved in this process.

Shanghai is the major force in establishing the technology innovation center. We will follow through the central government’s demands and complete the framework by 2020. Our current target is the construction of the Zhangjiang Comprehensive National Science Center. National laboratories are being built depending on photon science, energy technology, brain-inspired intelligence, nanotechnology, computer and other sciences. Now we have a preliminary plan for Zhangjiang Science Town. All above are merely part of our target to make Shanghai a technology and innovation-oriented place. We will also formulate a batch of service platforms whose research will benefit multiple industries.

Talents are fundamental in the construction of the technology and innovation center. Shanghai is in need of talents more than ever. The mechanism for using innovative talents will be upgraded while the companies will be given more rights to free bid for employees. Last September we added 30 rules to the talent policies from 2015, but this is not final. We shall grab hold of the policy trends and make Shanghai a premium talent pool and a place where talents can accomplish their value.

Phoenix TV: Hong Kong Disneyland has been suffering a deficit for a long time. How are things with Shanghai Disney? Is there a number that can be made public? And how do you see its influence on Hong Kong Disneyland? Besides, is there a specific schedule for subsequent expansion of Shanghai Disney?

Ying Yong: Shanghai Disney has been running for more than half a year and received over 5 million tourists. Counting in the overall visitors to the parks nearby, the number would hit 11 million.

Financial statistics will be disclosed to the public when the enterprise deems it proper.

As for the competition between the two Disneylands, I find them to be very different in their features, entertainment settings and customer base. China has a huge market and the two themed parks should be able to complement each other and grow.

Last November, Shanghai Disneyland announced plans to initiate its first phase of expansion, the “Toy Story” park. Both Chinese and foreign partners will continue to work together toward its better future. We are confident about its prospects.

Xinmin Evening News: This year a new college entrance exam system will be put into effect. Students as well as parents are concerned. What precise steps will the Shanghai education administration take to ensure a smooth transition between the old and the new system?

Ying Yong: The entrance exam reform will be able to improve students’ comprehensive quality towards an overall development. There is bigger chance that students have a say in choosing their college and major. The updated enrollment standard will be based on students’ entrance exam scores, the academic level exam scores and refer to the comprehensive quality during the high school period. The separation between liberal arts and science will be removed and students can choose three exams to take apart from Chinese, Mathematics and English. With the subject division abandoned, candidates can lean on their hobbies and strengths when filling the form to select a school and a major.

In expediting the institution reform, enrollments for first-class and second-class universities have been combined. Art and some other majors will temporarily have enrollment in the spring. Assessment for the high school students’ comprehensive qualities has been carried out. In independent recruitment, colleges will resort to multiple perspectives of appraisal and various channels and be impartial and open to public inspection.

This is the first year of the new entrance exam system. Arrangements will be as specific as possible to inform and facilitate the students. Meanwhile the entire enrollment system is new this year, so stress tests will be performed to make sure everything is in place. One important aspect to examine the efficiency of the entrance exam reform is how much the students can gain and whether they are satisfied. I sincerely hope that more students can be admitted to schools they long for and study in a major they prefer.

Shanghai Radio: The question is about the atmosphere. According to statistics released by the monitor department, the air quality index at 5 o’clock this afternoon indicated a premium 32. Also, the Shanghai Environmental Bureau said that Shanghai is having declining days of heavy air pollution. So what are the main pollutants now in Shanghai? What will Shanghai do to further improve air quality through regional cooperation?

Ying Yong: We live under the same sky; and a fine eco-environment would be a general benefit for all people. It should be firmly remembered that “the green environment is a treasury” and the ecological environment is a bottom-line for urban development. Last year, Shanghai was able to fulfill the key task of “cleaning its air” ahead of the plan. The average PM2.5 level has dropped to 45 micrograms per cubic meter from 53 in 2016. Heavily polluted days slid to two from the earlier eight.

According to analysis from the monitor department, local polluting sources include land and water vehicles, industrial wastes of volatile organic emission, the burning source from power plants and factory boilers and dusts from construction sites and traffic.

Apart from these, there are regional as well as natural factors. As for the former, we shall further reinforce the joint effort in pollution prevention and control, share monitor data and promote a coordinated reaction in case of heavy pollution. We are fully prepared to plunge ourselves in this long and tough fight of cleaning up the environment. Common endeavor will constantly improve Shanghai’s air and bring back more clear skies.

Chung T’ien Television: The Shanghai-Taipei bi-city forum always promotes cooperation between the two cities but the mayor of Shanghai has not visited Taipei for a long time. So will you visit Taipei in your term? What fields do you think the two cities can further promote cooperation?

Ying Yong: After the Shanghai-Taipei bi-city forum was first held in 2010, the two cities have inked 26 cooperation agreements in multiple fields, which play a huge role in promoting cooperation between the two places and have won support from people of the two cities. I have always paid close attention to the two-city forum. The forum has provided a platform for the two cities to learn from each other in urban construction experiences. I hope that the cooperation between Shanghai and Taipei in all fields can be deepened and further developed on the basis of the 1992 Consensus to bring even more benefits for residents of the two cities.

China National Radio: In recent years, the central government has integrated streamlining administration powers and offering services so the Shanghai government has taken on pilot programs in multiple fields. So what new reform measures will be taken this year?

Ying Yong: Improving streamlining administration, delegation of power, loosening integration and enhancing supervision and optimizing service reforms are core measures of transiting government roles. The reform should also deal with the link between the government and the market well to lower systematic costs for trading and reduce companies’ burdens. The Shanghai Municipal Government has been following the central government’s orders in enhancing measures in these fields and has made preliminary achievements. We will continue to make changes in this field such as further deepening reforms in separation of issuing business licenses and permits as well as optimizing supervision systems.

Last year, we conducted pilot reform in Pudong New Area on separation of issuing business licenses and permits following the central government’s regulations. This year, the municipal government will extend the scope of reform in Pudong: last year’s pilot reform included 116 administrative permits into the separation test. Some permit approvals have been halted, some permit approvals have been converted into registry; some approvals have been streamlined while others have been preserved. This year an additional 70 permit approvals will be added into the pilot reform and we hope that we can include all permit approvals in the economy sector into the reform. Besides, more districts will also be included into this pilot reform. Last year, the whole municipality implemented 37 permit approvals out of the 116 permits reform fruits in Pudong. This year, more reform fruits will be implemented citywide.

Last year, Shanghai abolished or adjusted 384 administrative approval items and 142 evaluation and review items and this year the city will continue the task to further abolish or adjust some approval items. The government will also carry out “separation of government affects with some institutions”: approval of relevant service agencies will be fully separated from government departments; industrial associations and chambers of commerce will be fully separated from administrative departments; and administrative or top level public charity organizations will separate fully from their affiliated companies.

The efforts to improve government services will focus on promoting Internet Plus administrative services, which will include acceleration of connecting service items relevant to society, companies and people to the Internet. Online administrative service centers will be also fully linked with offline administrative service centers. Authorities will also increase the scale of government purchased public services to further play the role of social organization well and promote the construction of a social credit system. The city will use these reforms to further lower companies’ burdens particularly systematic costs on trading. Last year, full-scale reform of replacing operation taxes with value-added taxes, adjusting social security deposit rates, lowering electricity prices, reducing administrative charges and lowering import and export charges have reduced companies’ costs by more than 85 billion yuan. This year, Shanghai will take further measures to help reduce companies’ burden and increase the dynamics of companies and society. The public is concerned about food safety and Shanghai has been supervising the food market with the “Four Strictest” rules but now there are online food stores and more and more popular take-away food delivery services. Will the supervisors have some new thinking and plans for these new situations?

Ying Yong: “Food and safety come first”. Food safety is a key project closely relevant to residents’ livelihood. As a mega city, the Shanghai government will stick to maintaining food safety as its bottom line for public servants and also as a top priority. We will follow President Xi Jinping’s “Four Strictest” rules namely the most precise standards, the strictest supervision, the harshest punishments and the most serious investigation. Last year, we formulated an action plan according to the four rules.

The Shanghai People’s Congress’ recent session passed legislation on food safety, which included good practices and good experiences into the legislation according to legal grammar. The new legislation also prepared supervision measures for some new situations, problems and business models on food safety. The new set of rules has detailed regulations on food delivery, online food stores, individual food workshops, food peddlers as well as helping government departments to enhance supervision and coordination during their food safety tasks. We hope that the media will promote this new legislation comprehensively. This new legislation offers legal support to food safety work for the next time period.

The laws’ life lies in implementation so we have to implement the new set of rules well to enhance supervision and strictly ensure that companies shoulder their responsibilities as well as mobilize the public to make Shanghai a city with the best food safety situation, a favorite city for consumers without worries and a city whose residents are most satisfied among all cities in the world. The law will improve the city’s soft power in comprehensive competitiveness and I hope the media can focus on this issue as well as offering supervision.

Ying Yong: There is only one week before the Chinese Spring Festival so I take this opportunity to express my Spring Festival greetings to all residents of the city as well as all media workers here. I wish you all an auspicious festival.