and we're trying to aim towards that. and we're trying to build a system, a network for that. one feature of the system is to have an institutional set of -- a set of institutional arrangements. so we do see these as major priority and we believe there's potential. but there are challenges ahead. we are not going to solve all the problems. for example, we're trying to review the tax scheme and the minister of finance and the tax authority have worked together to, for example, exempt tax on vegetables and also the replacement of turn over business tax but with vat.

and also the measures to remove fees on toll roads. i mentioned about 18% of gdp is logistic cost. also, we are trying to study and implementing measures to insure fees and charges for great connection and also water tariffs. and we are also doing our things, for example, you would try to make organization better for logistic companies, for example, we support those major master supplies. but we also want to pay attention to the smaller companies because they account for the majority. we're trying to have a community

based vegetable shops and farm shops and direct selling shops for vegetables and fruits. and meat. we mentioned the public good infrastructure will be built for logisti logistics. for the farm goods seconder, if we can create a complete supply chain, very well established chain, then the cost will be cut by about 50% and people will have access to nutritional, fresh and healthy food. last but not least, we will try to rectify the situation of unjustified fees between suppliers and retailers. even the current commerce will have a long way to go.

and we'll take off substantially because before those physical shops for retail and wholesale. there's a lot of deficiencies and imperfections. so e-commerce comes around and compared with developed countries, we'll see more rapid growth in this sector. we estimate according to our preliminary statistics, we are already seeing about six trillion worth of transactions every year which account for about 13% of our gdp and we have about -- so this is really a very promising sector. and this is a sector where small and same profit companies will benefit. they will be able to become entrepreneurs and start their own business online.

and this is a new business type and the cost of setting up a new business online is relatively low. and compared with that if you want to set up a physical shop in the center of a city then it will be impossible, unimaginable for someone who is fresh out of school. it calls for better credit rating and that is something we are trying to focus our efforts on. our e-business operators will have a good credit history and rating. thank you for your questions. and next question? in the middle. sixth row, the gentleman.

brag speaking foreign language ] >> translator: thank you. me question is about china's fta strategiment we know china, japan and korea agreed to

officially launch the negotiations on the tri-party fta in may this year. however, china and korea are now ready to start the relevant preparation work for the china career bilateral fta. so do you see the possibility that we'll see a china-korea bilateral fta before the china, japan, korea tri-party fta? my second question is about china's position and the ttp initiative. do you foresee the possibility that china will some day join the ttp? thank you. >> translator: let me first talk about china, japan and korea and then ttp. >> translator: we all know china, japan, korea and other countries in east asia share

many discussions on developing this region into a greater degree of integration and china, japan and korea have respectively agreed with the countries over the three ftas. their over fta and then we will accelerate the entire process of economic integration in east asia. therefore, i think this discussion can be very important. as you rightly mentioned, according to my information, the investment protection agreement negotiation between the three countries will be concluded shortly. the china-korea --

china-korea-japan fta was also concluded recently and when recently the president lee visited china, he forced a consensus with the chinese leader that the korean side will launch its internal recollect fiction procedures and as far as those domestic procedures are completed, the bilateral negotiations can take off. we hope that sometime later this year we will be able to officially launch the negotiations on the tri-party fta. all the three countries support this fta initiative. and our attorneys are working at this moment. i believe their discussions, their preparation will score a very good result. and this triparty fta plus the three separate ftas between

china, japan and korea, we'll see acceleration of the entire process of east asia integration. and talking about this issue i want to share with you the general position of the government. china supports the multilateral system featuring the leadership of the world treaty organization and the wto process is the main way to realize what international trades liberalization. at the same time, regional trade arrangements or bilateral or multilateral ftas can serve a good supplementation to the manned process of the wto. that's why we've been working very hard to promote bilateral ftas. but at the same time, we have been very cautious to make sure

that our efforts in that can support the process. the three ftas and we see the ten plus six process. we want to promote the 10 plus 3 and 10 plus 6 processes at the same time. when it was regarded 10 plus 6, we mean the united states, australia and india are also engaged. now the united states initiated the tpp. and this is a new way china believes tpp will also involve very diversified discussions. the tpp will include

transparency and openness and tpp sure respects the role of the wto in the multilateral trading system as well as supports the role of the wto in leading the global trade and investment. you ask me whether china will join the ttp some day or not. at this moment we're part of china and studying this tpp initiative. we are trying to figure out what are the benefits for china, what are the standards as well as the gap between the requirements, demands and china's national reality. so this moment we're still at the stage of evaluation and assessment. at this moment, my economies are already involved in tpp.

but i think the decision of japan to participate in ttp will not and will not negatively afact the engagement in other region initiatives, thank you. >> the gentleman in the first row. next question. [ speaking foreign language ]

>> translator: i'm with the business times. we've seen that the two-way investments across the taiwan straits have been progressing in a very steady way and according to the third round of policy review carried out by the taiwanese authority in charge of economic affairs, the taiwan side will further relax the limitations, equity ownership by foreign investors and chinese mainland ambassadors in setting

up this and producing some semiconductors or displace and panel products. so i want to ask you that if given the very good investment cooperation across straits and if the taiwan authority decides to significantly relax conversations on equity and estimates by mainland companies in local taiwanese businesses, will your ministry, the ministry of commerce make any friendly and prompt reaction by encouraging mainland companies to go to taiwan and invest in the above mentioned business? thank you. >> translator: thank you for your question. after the presidential -- the election concluded in taiwan, the economic and trade relations

between the mainland and taiwan will continue to prosper and move forward. and something we look forward to. first i want to mention the e m early harvest which will take place this year. that means more products, especially farm products from taiwan will find their way to the mainland. and this will be a boost to the taiwanese economy. very positive news for the taiwanese economy. and also this year, you know, our negotiations we have four critical steps. number one, the bit and the services and the fourth one is dispute settlement mechanism. i have noted that the taiwanese authority has already released information that within this year at the foundation, cross rate foundation and also the

cooperative council between mainland and taiwan, we are aiming at signing those -- the bilateral -- the investment protection agreement across the strait on that occasion. if that materializes, then we are really welcomed towards more chinese -- mainland companies to invest in taiwan as i mentioned. taiwan has a lot of comparative advantages and the mainland also has its own comparative advantages. for example, taiwan's many china -- the mainland's manufacturing capability and taiwan's high-tech sector if we combine our forces then one plus one is more than two. so we do require a lot of sectors to be opened by the taiwanese authority including electricities and i.t. also, we are looking forward to

opening up agriculture, r & d and other sectors and we're making preparations for that. eventuality and we are in the process of looking into the possibility of mainland companies investing in taiwan and also participating in -- by holding equities if taiwanese companies. i hope that there's good synergy between our two parties and after the signing of the investment protection treaty, this will accelerate. we are also looking at other sectors including trading goods and trading services. the two other documents we hope that progress can be made by early next year. thank you. and also how long the timetable.

the time for questions. time is actually up. but minister chen has agreed to answer more questions so we will accommodate a few more. the gentleman in the third row to my right. [ speaking foreign language ]

>> translator: over the years china's export trade is serving as an important driving force behind the economic growth of this country and export trade has always been a pillar of economic growth. however, this development strategy orientation also causes many problems. for instance, the export of low end products was realized at a very high environmental and

resource prize and also recently we've seen a contraction of external demand caused by the very serious debt crisis in europe as well as the slow and sluggish recovery of the u.s. economy. this also will negatively affect china's export trade. and there is also a tend i r ency that is to say that the ideological difference between china and some other countries will force china's export traders have to do with more hostility from other countries. so my question is what is your comment and what measures will the minister of commerce take to hand this will situation? thank you. . >> translator: you mentioned the constant or continuous export of china's low end products.

you also mentioned the impact of ideology on china's foreign trade. well, my answer is as follows. when we look into the economic situation, we should try to find the light in the darkness. so when the world economic situation remains on certain, we will fleed to realize that fundamentally people need to consume to meet their daily consumption needs. at this moment, china's export trade is basically dominated by medium end products instead of low end products. over 70% of china's exports are machineries and electronic products. over 60% of our exports are produced, supported by advance the technologies and by foreign investors companies working in china.

they are producing exports, for example, foot ware, clothes, apparel and suitcases and things like. that however, these chinese products also moving up the valley chain from a very low end to a medium end. for instance, we are now able to produce very good foreign fibers and this situation is, of course, determined by the increase of our labor cost. the change of our taxation and incentive policies. so this forces chinese exporters to move up the value chain. china also seeks to strike a balance between import trade and export trade we never pursue a very big trade surplus with other countries. so china has 1.3 billion people,

19% of the world's total population. it's export trade alone united states ten or 11% of the world total trade. this was the figure for the year before last. for the last year, the figure will wait until the wto releases it. so 11% export made by 19% were the population is not a very good proportion. and the population is much smaller but it's a share in the world export trade is similar to that of china. so china no longer emphasizes that we are an exporter country. at this moment, china is the biggest exporter in the world. at the same time, we should be remember that china is also the second biggest importer important country in the world. so i am very confident that

since we have $1.3 billion people, we have very big space for adjustment and the next few years china will become the biggest importer in the world by 2020. the total china's domestic market will become the biggest one in the whole world. given all this said, i'm not worried about any negative impact of ideology. ideology is not welcomed in the trade world. and ideology is not in a position to challenge the principal of aprilneopen fs and play. china will be the biggest market, biggest importer in the world and at the same time china is able to maintain a balance between import trade and export

trade. i'm not very worried about the ideological matter or problem. my ministry has diplomatic and over 150 countries and we have the chinese diplomats have never had the problem that purely because of ideological problems those countries refused to trade with china. we also encounter problems at export control policy by some countries due to their national security reason or they are reluctant to accept chinese investments into their own countries. that's why i said earlier in balance between they are not completely caused by exchange

rate. it is also caused by trade policies. and i don't think the practices of those countries are fair for their own countries for their own industries. that's not in their interest. so china's very confident that there is 1.3 billion population, they are our strongest and most accountable force backing us to develop our external trade. we will not create trouble for the countries. thank you, minister. >> coming up in just under five minutes, we'll go live to the museum here in washington for an event with health and human services secretary kathleen sebelius. she'll be joined by the u.s. surgeon general and director of the centers for disease control to discuss the launch of a new national tobacco education ad called the tips from former smokers campaign. we'll hear from people currently battling smoking related

illnesses. that will be live shortly. until then, a clip from an event last week with secretary sebelius outlining the results of a new report looking at smoking use among youth. >> first surgeon's general report on tobacco was published in 1964. the good news is we've seen the percentage of americans who smoke steadily decline. in 1965, over 42% of americans smoked. by 2004, it had fallen to just under 21%. and that's very good news. but for all the progress we've made, tobacco use remains the biggest single threat to american's health. it kills an estimated 443,000 americans every year. 443,000. and every tobacco-related death is replaced by two new smokers under the age of 25. today's report brings more

troubling news. it's the first of its kind to explore the causes and consequences of tobacco use among youth and young adults. it shows us just what we're up against. today, all over america, there are middle schoolers developing deadly tobacco addictions before they can even drive a car. and the younger a child is when they try cigarettes, the more likely they are to get and stay addicted to nicotine. one child picking up a tobacco product is one too many. but the fact that each and every day across america more than 3800 kids under 18 smoke their first cigarette is completely unacceptable. but this report also underscores the importance of the historic efforts the obama administration has taken to stop youth from using tobacco products and to help adults quit smoking. since the numbers weren't changing fast enough, we had to change the way we rid our

communities of tobacco. so that's exactly what we're doing. we push wide-ranging legislation, that among other things, makes it harder for tobacco companies to market to our children. it also restricts companies from using terms like light or mild on products and in marketing. and it bans certain candy and fruit flavored cigarettes, all of those were techniques aimed at people often younger than 18. that legislation had been debated for years and years in this country and we finally got it done. we're also supporting local programs to help people quit smoking and stop people from starting in the first place. as part of last year's health care law, we gave americans better access to counseling to help them quit smoking before they get sick. around the country, we have great partners. we've seen states join this fight with 28 states and wa