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Press Release of the State Council Information Office

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Promote Sustainable and Healthy Development of the Industrial and Communication Sectors through Transformation and Upgrading

Ministry of Industry and Information Technology (MIIT)

?(July 24, 2013)

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Since the beginning of this year, the Ministry of Industry and Information Technology (MIIT) has carried out the decisions and plans from the Central Government through coordinated and intensified efforts at growth stabilization, restructuring, reform and benefit for people’s wellbeing, as well as the proactive promotion of industrial transformation and upgrading and the stimulation for in-depth integration between informatization and industrialization, as a result of which the industrial economy has been developing steadily as a whole with the communication sector experiencing steady growth. The development features of the industrial and communication sectors in the first half of this year are as follows:

First, the overall economy has been developing steadily. According to the statistics of the National Bureau of Statistics of China (NBSC), in the first half of this year, the industrial added value above the designated scale nationwide increased by 9.3% year on year, 0.2 percentage points lower than that of the first quarter, among which 8.4% was for the light industry while 9.6% for the heavy one. From January to May, profits gained by industrial enterprises above the designated scale went up by 12.3% year on year from 2.4% decrease during the same period of last year; hence the recovered corporate profitability. In addition, in the first half of this year, the revenue from telecommunications businesses increased by 8.9% year on year with 319 million 3G users and almost 50 million new TD users (137 million in total) being reached, 2.1 times higher over last year.

Second, the restructuring efforts have been proactively promoted. With the further acceleration in the development of strategic emerging industries, the high-technology industry grew faster than that of the traditional one and the proportion of technological retrofitting investment to industrial investment continued to increase. More efforts were made to cut back on overcapacity especially for the iron and steel, electrolytic aluminum, cement and flat glass industries etc., among which 19 of the 2013 list were phased out in a quicker manner. Moreover, the corporate merger and reorganization tended to be more active, the first batch of qualified enterprises for the “Standard Conditions of the Iron and Steel Industry (Amended in 2012)” was published, and the energy efficiency retrofits and standard benchmarking for key industries were greatly promoted with the energy consumption per unit of industrial added value being reduced far beyond the whole-year expectation.

Third, information consumption has played an increasingly prominent role in driving economic growth. Based on related measurement, from January to May, the information consumption was scaled up to RMB 1.38 trillion, up by 19.8% year on year. With the rapid development of the mobile Internet and the services and products in the emerging sectors of information consumption, the number of WeChat users exceeded 400 million, driving the 56.8% revenue growth from mobile traffic. As emerging types of consumption based on household broadband access, online video, online shopping, micro-media, mobile payment and mobile video developed in an accelerated manner, the information service consumption drove the economic growth more prominently. In the first half of this year, the market scale of the e-commerce industry reached RMB 5.4 trillion, up by 38.5%, the sales of smart phones and TV went up by over 25%, about RMB 129.7 billion were invested in telecommunications infrastructure, and the number of cities for TD-LTE scale test increased to 15.

Fourth, the in-depth integration between informatization and industrialization has been undergoing on a solid foundation. While promoting the pilot program of such integration and entering for the examination of the second batch of pilot areas, we conducted research on formulating an overall framework for the five-year action plan of such integration and a pilot program for innovative actions of industrial cloud, and also implemented the pilot project for integrated e-commerce innovation. Furthermore, the convergence of telecommunications, media and information technology (IT) sectors was promoted proactively, the comprehensive IT integration was constantly improved and a series of national demonstration bases for new-type industrialization which were characterized by the in-depth integration mentioned above were constructed at a faster pace with impressive results being yielded.

Fifth, continuous improvement has been achieved in the environment for small- and medium-sized enterprises (SMEs) to develop. In order to fully implement the Recommendations to Further Support the Healthy Development of Micro- and Small-Sized Enterprises of the State Council, governments at all levels and related departments have promulgated 45 supporting policies, and 32 provinces, autonomous regions, direct-controlled municipalities and cities with independent planning power have also formulated related implementation opinions. In addition, the construction of SME service system was accelerated with 20 provinces having launched the construction of online public service platforms for SMEs, 1,757 service resources being motivated by 10 provinces during the first phase of construction, service matching activities being held for 49,000 times and 390,000 SMEs being covered annually. We also strengthened our support for SME credit guarantee, strived to resolve the difficulty of corporate financing and carried out special actions to assist micro- and small-sized enterprises.

Despite the above mentioned achievements, the industrial development is still facing a complicated situation with old and new contradictions interwoven with each other and with increased difficulties and challenges emerging, in particular the aggravating contradiction between insufficient effective demand and overcapacity, the rising difficulties in production and operation for micro- and small-sized enterprises and the urgent and demanding tasks for industrial transformation and upgrading. To this end, we must attach profound importance and address them at full stretch.

In the latter half of this year, by sticking to the principle of seeking progress, achievement and quality amid stability and by taking the improvement of development quality and efficiency for the industrial and communication sectors as the core, we will fully implement the decisions and plans of the Central Government to address overcapacity, stimulate information consumption, promote the in-depth integration between informatization and industrialization and remove the prominent constraints during the industrial transformation and upgrading so as to ensure the sustained and healthy development of the industrial and communication sectors and better achieve the expected goals of the economic and social development for the whole year.

First, integrate efforts on growth stabilization with that on restructuring and transform the development mode. We should intensify our efforts on technological retrofits for enterprises, implement the strategy of building on solid industrial foundation, seek healthy development of strategic emerging industries, and continuously promote industrial energy conservation and emission reduction as well as the clean and safe production to achieve green and low-carbon development.

Second, promote industrial transformation and upgrading by addressing overcapacity. With the iron and steel, electrolytic aluminum, cement, flat glass and marine industries serving as the key, we should provide guidance for enterprises to strengthen their technological retrofitting, promote corporate merger and reorganization, accelerate efforts on phasing out backward capacity by adhering to and improving the capacity equal or reduction replacement system, guide industrial transfer in order, and establish a long-term mechanism to effectively address overcapacity.

Third, accelerate the development of new-type consumption such as the information consumption to drive stronger economic growth. While accelerating the promulgation of several opinions and key measures to promote information consumption and to propel domestic demand, we will also speed up our construction of information infrastructure and the development of information industry, boost information demand, improve supplying capacity for information products and stimulate the development of information services.

Fourth, further improve the corporate development environment and strengthen support for micro- and small-sized enterprises. We will fully implement the Recommendations to Further Support the Healthy Development of Micro- and Small-Sized Enterprises of the State Council with improved supporting policies and continuously support the construction of online public service platforms for SMEs to encourage and guide service agencies to provide quality services for them.

Fifth, promote the in-depth integration between informatization and industrialization and ensure cyber and information security. While continuing our efforts on the pilot program of such integration and supporting key informatization projects, we will also promote the Broadband China 2013 special actions to enhance the convergence of telecommunications, media and IT sectors, and strengthen and improve the regulation of the telecommunications market with a stronger guarantee system for cyber and information security.