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Real-time News
The Bank of Japan reported that core CPI, excluding special factors, rose 2.7% year-on-year in June, the same as in May. Core-core CPI, also excluding special factors, rose 2.0% year-on-year in June, compared to 2.1% in May.On July 28, the Ministry of Commerce released Chinas position on the so-called "overcapacity" issue. The document states that openness brings progress, while isolation inevitably leads to backwardness. All parties should dismantle barriers, expand openness, continuously tap market potential, and provide greater space for industrial cooperation. Reducing trade barriers is crucial. The larger the trade volume, the more difficult it is to avoid disagreements and frictions. Focusing solely on "building walls" will only exacerbate conflicts and will not help solve the problem. All parties should adhere to open cooperation, facilitate the cross-border flow of domestic and foreign factors, promote full market competition, stimulate enterprise vitality, and continuously enrich new supply and create new demand. Isolation will only result in a lack of market vitality and greater obstruction to innovative development. Reducing barriers to investment cooperation is also essential. Investment cooperation is an important way to expand the pie, strengthen ties, and enhance mutual benefit, meeting local needs while also driving the development of host countries. All parties should relax restrictions on investment access, simplify procedures, eliminate barriers, provide a fair, transparent, and predictable environment for foreign investors, and better protect their legitimate rights and interests.On July 28, the Ministry of Commerce released its "Chinas Position on the So-Called Overcapacity Issue," stating that the claim that "insufficient domestic demand in China leads to overcapacity" is untrue. China is not only a manufacturing powerhouse but also a major consumer market. Domestic demand has consistently been the main engine of Chinas economy, contributing an average of 93% to Chinas economic growth from 2013 to 2024. According to World Bank purchasing power parity calculations, Chinas total retail sales of consumer goods will be 1.7 times that of the United States by 2025, making it the worlds largest consumer market. Currently, China ranks first globally in physical consumption, with per capita annual consumption of some industrial products approaching that of developed countries. In recent years, the growth rate of Chinas total retail sales of consumer goods has slowed, consistent with Chinas economic shift from high-speed growth to high-quality development, and reflecting the upgrading trend of Chinas consumption structure. Attributing the slowdown in Chinas retail sales growth to insufficient domestic demand is neither objective nor comprehensive. The argument that "insufficient domestic demand in China leads to overcapacity" is a fallacy of applying a micro-level market phenomenon to the macro-level structural level.On July 28, the Ministry of Commerce released its "Chinas Position on the So-Called Overcapacity Issue." The document states that China never deliberately pursues a trade surplus. Chinas export growth stems from both economies of scale and increased innovation capabilities, as well as the demands of green transformation and industrialization in various countries. For example, Chinas export growth to Europe is mainly concentrated in photovoltaics, new energy vehicles, lithium batteries, and chemical products, reflecting the demand for energy products driven by green transformation and the increased production costs in European chemical and other industries due to the energy crisis. China also never deliberately pursues a larger share of labor-intensive product exports; the export share of these products is projected to decrease from 20.7% in 2012 to 15.1% in 2025. Regarding the distribution of trade benefits, "the surplus is in China, but the benefits are shared by all parties." In 2025, foreign-invested enterprises will account for 27% of Chinas exports and 16% of the surplus, with both surplus and profit growth rates exceeding those of domestic enterprises. Looking at the overall balance of payments, although China has a large surplus in goods trade, it has deficits in services trade and investment income. Overall, the current account surplus accounts for approximately 3.7% of GDP, which is within the internationally recognized reasonable range.On July 28, the Ministry of Commerce released "Chinas Position on the So-Called Overcapacity Issue," clarifying relevant facts and outlining Chinas policy stance on the issue. The document states that China has always maintained that the issue of overcapacity should be viewed comprehensively, objectively, and fairly, taking a historical and dialectical perspective, upholding openness, cooperation, and mutual benefit, and jointly resolving contradictions and differences. Protectionism will only disrupt the global economic and trade order, hinder the security and stability of global supply chains and the healthy and orderly development of industrial cooperation, and pose long-term risks to global economic growth.
