The Flanders-China Chamber of Commerce (FCCC) organized an exclusive webinar with H.E. Mr Cao Zhongming, Ambassador of the People’s Republic of China in Belgium on 16 December 2020.

Mr Stefaan Vanhooren, Chairman of the Flanders-China Chamber of Commerce, welcomed Ambassador Cao as honored speaker to the webinar, adding he had not been able to meet the Ambassador in person for some time due to Covid-19. Today, we are experiencing difficult times due to Covid-19, which has changed our world, he added.

H.E. Mr. Cao Zhongming, Ambassador of the People’s Republic of China in Belgium, said it had become a tradition to attend the reception of the Flanders-China Chamber of Commerce at the end of the year to meet face-to-face, but this year we meet online which is also a good opportunity to have exchanges. Ambassador Cao next gave a short introduction to the performance of the Chinese economy and offered some suggestions and personal ideas on how to further promote FCCC members’ cooperation with China. The Ambassador also presented his best holiday wishes to the FCCC members. At the moment, Covid-19 is having an adverse impact on the world economy and all countries are facing serious challenges. There are also reports that inoculations in Belgium will start in January next year, and hopefully Belgium will overcome Covid-19 as soon as possible and have a good economic recovery.

Many entrepreneurs are focusing on what has been happening in the Chinese economy. As China has put Covid-19 under control, China is among the first countries to resume production. According to World Bank projections, China is on course to become the only major economy that will have positive growth this year. For the first three quarters of the year, China’s GDP has achieved a positive growth of 0.7%. China has for the first time become the largest trading partner of the EU. From January to October, China’s actual use of foreign capital topped USD115 billion, a year-on-year growth of 3.9%. Non-financial FDI reached USD86.3 billion, among which about USD14 billion for participants in the Belt and Road Initiative, up by 23.1%. In November China’s manufacturing PMI, the new export orders index and the import index respectively stood at 51.5 and 50.9, up by 0.5 and 0.1 points compared with October. This shows that China’s domestic demand and international demand for Chinese products are all improving. Recently, the 5^th plenary session of the 19^th Central Committee of the CPC has adopted a suggestion for China to make its economic and social development plan for the next five years. The Chinese government is making a scientific analysis of the new development phase, will stick to the new development philosophy and set out to foster a new development paradigm with the domestic situation as the mainstay and the international situation reinforcing each other. This is the direction the Chinese economy will take in the future. In the meantime, China will deepen opening up and will try to bring out more synergy between the domestic and international economic cycles. 

China’s 14^th Five Year Plan will bring development opportunities to the world, including Belgian entrepreneurs. The first aspect is the good timing brought about by China’s new development paradigm. Chinese President Xi Jinping pointed out at the 15^th Summit of the G20 leaders’ meeting that adhering to a new development paradigm is not about adopting a closed door policy, but is rather about making efforts at both supply and demand and to promote unimpeded flow all through the process of production, distribution and consumption. China will continue to improve the resilience and competitiveness of the economy and build a new economic system of opening up at higher standards. Under the new development paradigm, China will fully unleash its market potential and there will be more market demand. China will open up more and share its development opportunities with the world and deepen win-win cooperation with the international community. The Ambassador expressed the hope that Belgian companies will seize the opportunities in the next five years and embrace the Chinese market. 

The second aspect is that China will work to improve its business environment for foreign investment. Since the beginning of this year, the Chinese government has worked to relax market access, adopting the negative list for foreign investment and an industry catalogue encouraging foreign investment, and encouraging more foreign companies to invest in such sectors as high-end manufacturing, high-tech sectors and also renewables, energy conservation and environmental protection. China also adopted a negative list for cross-border trade in services to expand talent programs for the service industry and also is working on foreign investment laws to improve the foreign-related legal framework, enhance IP protection and work to ensure that domestic and foreign companies enjoy the same preferential policies. China’s legal environment will be improved to ensure equal competition between domestic and foreign capital. China will also accelerate the building of free trade zones and free trade ports and try to make the business environment more fair, equitable, transparent and friendly and making it a top option for investment of European companies, including Belgian companies. 

The third aspect is that China will work to step up pragmatic cooperation with the international community as stated by President Xi Jinping at the APEC CEO dialogue not long ago. He said that China would actively take part in the international division of labor and become integrated in the global industrial value and supply chain. China is committed to expand cooperation and exchanges with the outside world. China is open to cooperation with every other country, region and enterprise, that wishes to do so. This year, China’s per capita GDP will exceed USD10,000 and the middle-income population will reach 400 million. Many international agencies are projecting that China’s retail market sales will reach USD6 trillion this year. In the next five years, China with its mega market and its complete range of industries, will provide more opportunities for all countries. Although affected by Covid-19, China and Belgium’s trade figures are growing. For the first nine months of 2020, bilateral trade reached close to CNY20 billion, a growth of 7.4% year-on-year. This year, China-Belgium trade is on course to exceed that of 2019. China is open and ready to share the dividends of its high-quality development to fully unleash the potential of China-Belgium cooperation and work together with Belgium for common growth. 

Ambassador Cao proposed to continue to stick to multilateralism, maintain openness and inclusiveness, and seek win-win cooperation. With the authorization of vaccines and thanks to the measures to contain Covid-19 in various countries, there is light at the end of the tunnel. The Ambassador said it would be possible to put Covid-19 behind us and seek win-win cooperation to work for broad economic recovery between China and Belgium and China and European countries. He also hoped to see Belgian entrepreneurs traveling back and forth between the two countries soon and wished success to their business endeavors. 

Q&A session:

Many member countries are asking when travel restrictions will be lifted or changed so that travelers do not need to quarantine any more and companies can send experts to China again? Ambassador Cao: We fully understand that entrepreneurs from China and Belgium wish to resume free travel between the two countries as soon as possible. We agree that having face-to-face exchanges between our entrepreneurs will help to create more cooperation opportunities. China has brought Covid-19 infection under control. There are still sporadic cases but not on a large scale, but China is facing pressure on having imported transmission from international travel. There are more than a dozen imported cases on a daily basis even after taking precautionary measures. Just like in other countries, China has taken measures for international personnel traveling, including quarantine, and the EU took similar measures. Many Chinese entrepreneurs and businesspeople are not able to come and negotiate business deals in the EU at present. All those restrictive measures targeting the virus – not the personnel exchanges – will be adjusted in time as the virus is brought under control. If FCCC members have special needs to travel to China for emergencies, they can inform us, and we will examine the situation and take it into consideration as an exception.

As travel is not possible now, will one-year multiple entry visas be prolonged? Ambassador Cao: Because of Covid-19, China is adjusting its visa policy so for traveling to China visas need to be renewed. We will still have to see what to do with visas that were issued before Covid-19 after the epidemic is behind us. We are monitoring the situation, if there is an update it will be made public. We have border control measures to control the virus. If entrepreneurs wish to travel to China for emergency purposes it is a precondition for them to be tested and it is important for them to stay healthy.

Mr. Luc Arnouts: Do you believe that by banning Huawei we will hurt our good relationship? Ambassador Cao: Huawei has been doing business in Belgium for over one decade and has established a sound working relationship with its clients. In the past one to two years a certain country accused Huawei of having security risks without producing any evidence. This has had a negative impact on Huawei’s reputation and its cooperation with countries. It is regrettable that some European security agencies have been convinced or are under pressure from a certain country also start to question the security of Huawei’s products. This has been undercutting their efforts to do business in Belgium. It is an unsubstantiated claim that there are serious risks associated with Huawei’s 5G technology and it is also a pity that up till now Huawei is still to have the opportunity to take part in Belgium’s 5G market. We hope that this decision is not the final one because Huwaei is the leading company in the sector and has reliable and secure technology. At the end of the day, this is a decision taken by the Belgian government and the Belgian telecom sector. We have also made the point to the various competent Belgian government agencies that we hope there will not be discriminatory measures targeting Huawei, especially without any evidence suggesting any security risks. Both the Chinese and Belgian governments have the responsibility to protect our companies. In China the Chinese government has the responsibility to respect and protect the interests of Belgian companies investing in China and vice versa. We are still closely following the latest developments and see what will happen next.

Mr Kurt Vandeputte is responsible for Umicore’s global corporate affairs and has been in charge for 15 years of Umicore’s battery activities in Jiangmen. He said that Umicore announced better financial results for this year thanks to the fast recovery of the business in China for automotive catalyst products. Recently Japan and Korea, and China as well, have set targets to achieve carbon neutrality in a couple of decades. In Europe there has been a vote to accelerate the reduction of CO₂ emissions. There is a new target of reaching 55% reduction by 2030. Is the Chinese government also considering to increase their ambition for CO₂ reduction? Ambassador Cao: Umicore places high importance on climate change and environmental protection. It has invested in battery production in China. This is part of the green economy that will help reduce the use of photo cells and has also invested in the green sectors in China that will help to better protect the environment. As for China’s climate change policy, China is a major party to the Paris Agreement and has made contributions to ensure the adoption of the Paris Agreement in 2015. As a result of the policy of the current U.S. administration, whose term will end shortly, to withdraw from the Paris Agreement, the European countries and China are becoming major promoters of efforts to deal with climate change. China is a developing country with a large population so it is faced with the daunting task of development, but due to the philosophy of a shared future of mankind, China has great resolve and commitment to environmental protection, to green development, to conserve energy and reduce carbon emissions. Chinese President Xi Jinping has already announced that China will work to realize the carbon peak by 2030 and carbon neutrality by 2060. From carbon peak to carbon neutrality, China will take 30 years less compared to the EU, which is not easy. A few days ago at a UN Climate Ambition meeting, President Xi Jinping announced further measures by China to reduce carbon emissions. By 2030 China aims to reduce per unit GDP energy consumption by 50% compared to the level of 2005. The percentage of non-fossil fuels in supplying China’s primary energy consumption will be increased to 25%. There will be great prospects for non-fossils such as wind and solar power. China will increase its forest stock by 6 billion m². Overviewing the Earth from the Universe, much of the forest increase on the surface of the Earth can be attributed to China in recent years. 

Mr Thierry Smagghe‘s company has achieved African swine fever (ASF) free stage for Europe, which will be confirmed soon by the WOAH, and he asked for the Ambassador’s support to open China for Belgian pork. China still needs a lot of pork and Germany now also has ASF while Belgium is getting rid of it, offering an opportunity to get the trade going again. Ambassador Cao: The pig sector of Belgium is following closely its exports to foreign partners. In China pig farming is also a large industry and a very important part of Chinese agriculture so we have the responsibility to ensure that the hog industry will not be affected by swine fever. ASF is highly infectious and once it is spread is not easy to bring under control. The Chinese competent authorities in charge of meat quarantine are following developments very closely and implemented strict measures. We have been following closely the outbreak of ASF in some European countries. Because of Covid-19, part of the evaluation and analysis is also affected because site visits are impossible. For pork exports, it’s a technical problem. We need patience and wait for the Chinese competent authority in charge of meat quarantine at the borders to complete the process.

In which way will there be more opportunities in the medtech sector and especially in the tender-based business in the Chinese health sector like hospitals or labs? Ambassador Cao: This is a very specific question requiring professional knowledge. I only have limited information on China’s medical device market. From an overall look at the Chinese market, there is great demand for high-quality medical devices. During the trade mission to China led by Princess Astrid there was an agreement on medical cooperation between the Chinese and Belgian side. Due to various reasons it was not signed but it is worth continuing pushing forward. Belgian companies have made deals with Chinese partners, such as IBA, a company active in proton therapy devices. This is an example of Belgian companies expanding medical cooperation with China. It shows that the Chinese market is open to Belgian business partners and Belgian medical devices that meet the market demand of China will find their way to Chinese hospitals. A part of Barco’s business sectors is also devoted to medical devices and has great potential on the Chinese market. 

Mrs Gwenn Sonck: It is clear that many of our companies continue to be in China for China and China remains a top-3 priority. As China is the only country with a positive growth this year, many European companies in China have seen double-digit growth and it is thanks to the Chinese market that some companies have made profits in the region. Our Chamber is there for you to help you further expand in the Chinese market. We have built up a strong network in many locations in China which we want to share with you. Do not hesitate to contact us for any question or suggestion you may have. 

Ambassador Cao expressed the hope that the epidemic would be brought under control in Belgium and there would not be another rebound. The Embassy values the role that the FCCC has played in bridging the business communities of Belgium and China. Although the epidemic presents all of us with challenges, there are also opportunities. Some companies may be affected, others – for instance those in the wind business, environmental protection and e-commerce – will have greater opportunities. Belgium has a central location right at the heart of Europe so there is also a bond in transportation and logistics operations closely connecting the two countries. We are only two weeks away from welcoming 2021, marking the 50^th anniversary of China-Belgium diplomatic relations. We hope that Belgian companies will see this as an opportunity to further expand cooperation to set up trade and investments in China to make the third decade of the 21^st century even more fruitful for China-Belgium relations. The Chinese Embassy in Belgium will continue to facilitate our companies to deepen cooperation with each other and we hope that the FCCC will follow closely Chinese companies investing in Europe and in Belgium and their problems in operations and business in Belgium. As mentioned by Mr Luc Arnouts concerning Huawei’s problems in Belgium, the BIT is making a document related to 5G and public consultation. We hope that the BIT will continue to provide a fair, equitable and non-discriminative business environment for Chinese companies operating in Belgium. Hopefully next year the epidemic will be behind us and we will have more opportunities to work together. Stay safe and healthy, Merry Christmas and Happy New Year!