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Shanghai Municipal Government Press Conference Memo (February 22,2006)
8/3/2006 9:18

1. Eastday: I have two questions: firstly, do the city's Dangerous Chemicals Safety Management Regulations cover any new items in terms of licensing requirements? Second question: What does the consolidation and improvement of the cooperative medical care system in Shanghai's rural areas, as mentioned in the newly-introduced "suggestions on improving cooperative medical assurance standards in Shanghai's rural areas", mean for the establishment of "new socialist rural areas"? Thanks.

Zhang Zhongyu (vice director of Shanghai Municipal Government's Office of Legal Affairs): The Dangerous Chemicals Safety Management Regulations cover no new items requiring licenses, while the existing items are stipulated by national laws. We only made the regulations more detailed procedurally to make their execution more convenient. 

Jiao Yang: It is an important task proposed by the Shanghai Party Committee and Municipal government to consolidate and improve the cooperative medical care system in rural areas and also to establish a "new socialist rural area". The system, closely related to farmers' welfare, is not only an indispensable part of the Shanghai public health sector but also an important part of the city's social security system as well. The newly-introduced "suggestions on improving cooperative medical assurance standards in Shanghai's rural areas" will consolidate and improve the cooperative medical care system in rural areas, further enhance farmers' abilities to manage the financial risks caused by diseases, gradually bridge the gap in medical assurance standards between urban and rural residents and improve local cooperative medical security standards in suburban areas.

This year, Shanghai will accelerate the establishment of a new socialist rural area, and an important part of reaching this goal is the improvement of the public health system and medical service network in rural areas, the extension of support to the establishment of medical service systems in villages and towns, and the facilitation of the standardization of medical institutes there and improvement in service standards and quality. Meanwhile, the city should establish an incremental capital-raising system and improve cooperative medical assurance standards for farmers by upgrading the new cooperative medical care system in rural areas. We will also encourage the city-level hospitals to offer medical services to the suburbs and more of such hospitals to move to the rural areas in a bid to satisfy the medical requirements of farmers and improve their medical condition. Therefore, the introduction of "suggestions on improving cooperative medical assurance standards in Shanghai's rural areas" is very important for the establishment of a new socialist rural area.

2. Shanghai Morning Post: I have three questions. My first question is about cracking down on counterfeit ads. Shanghai held a special work conference yesterday on eliminating counterfeit and illegal ads. Can you tell me what are the concrete goals and measures for 2006? The second question is on small vehicles: on February 15, Shanghai began to restrict highly-polluting vehicles from entering the elevated highways in downtown areas. I noticed that the traffic department has removed the signs barring small microbuses of less than 1,300 cc-engine-capacity from entering the elevated highways. Does this mean that the city will lift the ban on small vehicles? What measures will follow? My third question is about public transport. It is reported in today's newspapers that Hangzhou has adjusted taxi fares on the basis of there being different taxi models. Some taxi companies adjusted the initial distances covered by the minimum charge while some raised the minimum charge. You said last year that local authorities were considering a new taxi fare system in response to fluctuations in fuel prices. Has the system been finalised? Do you foresee any adjustments to taxi fares?

Jiao Yang: Local residents also share your concerns. Your first question is about cracking-down on counterfeit ads. Yesterday, local authorities held a work conference on this issue, and local leaders have set forward the requirements and made work assignments. Cracking-down on fake ads is a long-term task to improve and standardize the market, and local leaders are paying much attention to it. Eliminating fake and illegal ads is an important task for this year, and is in accord with the expectations of residents and also the responsibilities of government and society. The city government has required all the relevant departments to take the responsibility of eliminating these counterfeit and illegal ads and punishing the perpetrators according to the law. This year's supervision and improvement work for the advertising industry has four basic goals: firstly, fake ads will be barred from major local media; secondly, those breaking the law will be severely punished; thirdly, the media's supervisory and responsibility system will be improved; and fourthly, the credibility and level of social satisfaction in this area will be improved.

To achieve these goals, the city will seek improvements in nine respects. I will briefly introduce these, and if you are interested in the subject you can get more information from local departments. Firstly, to bring the coordinating and commanding functions of the joint-conference system into full play to encourage public participation and improve social influence in cracking down on counterfeit ads; secondly, to improve supervision of ads and increase sanctions and the exposure of illegal ads; thirdly, to establish and improve the reporting system; fourthly, to establish a responsibility-investigation system in media units which are found to post counterfeit ads; fifthly, to conduct joint-investigations of ads to strengthen investigations and improve the investigative system; sixthly, to set up a system of judicial punishment  for advertising companies which release counterfeit and illegal ads in order to improve the supervisory and warning functions; seventhly, to explore and improve a system for unqualified advertising companies to withdraw from the market; eighthly, to establish a temporary consulting institute to encourage democratic and scientific advertising supervision; ninthly, to build-up the credibility of the advertising sector.

The improvement work I mentioned is not a one-off job, but an ongoing project. We will not only expand our coverage, but implement fundamental solutions as well, focusing on the establishment of a system for the long-term.

You are concerned about the relationship between the local restrictions on heavily-polluting vehicles and on small vehicles. The existing restrictions on heavily-polluting vehicles are based on successful experience from both home and abroad and also local circumstances in terms of pollution, with one aim being to improve the local environment and protect residents' health.

The lifting of restrictions on environmentally-friendly small vehicles from running on elevated highways and being operated as taxis was decided by six national departments in the light of the national laws and regulations relating to energy-efficiency, development policies for the auto industry and the country's medium and long-term planning.  The two regulations, both based on environmental protection, are in accord with the national and local situation, benefit both the country and the people and also meet the requirements of establishing an energy-efficient society. Shanghai will implement the measures by adhering to the national regulations.

3. SMG radio news center: I have a few questions about the first topic at the press conference, that is the "Dangerous Chemicals Safety Management Regulations".
Safety management of dangerous chemicals, particularly in transit, is very important, yet could be considered lax up to now. In the new regulations, it is stated that "effective management will be applied through each and every part of the transport process". I want to know what measures have been initiated to ensure thorough oversight?
Secondly, with the new regulations scheduled to take effect from April 1, are there any definite rules for their application, such as penalties on corporations or individuals that break the rules?
Meanwhile, in the new regulations, it's noted that "public safety awareness should be enhanced".  What specific measures will the government adopt to achieve that end? Thankyou.

Zhang Zhongyu: As mentioned, in ensuring the safety management of dangerous chemicals, transport is a hard nut to crack. On this issue, we have initiated a variety of measures. For example, the fourth chapter of the regulations deals with comprehensive measures relating to their transport.  Please forgive me for not itemizing them here one by one. As for legal obligations, an essential section of the new regulations, I must call your attention to the last chapter, which is concerned with the legal obligations of corporations and individuals, and penalties faced for infringements.
The reporter also asked about promotion of the regulations before their implementation on April 1. The municipal government has required district and county governments as well as related municipal government departments to manage it. I assure you we will organize mass-media promotions before April 1. Thank you!

4. Shanghai Financial News: It's reported that the China Securities Regulatory Commission held two meetings recently and decided to locate the country's financial derivatives exchange in Shanghai. My question is whether the exact location of the exchange has also been decided, and after the staff are appointed, how would their children get schooling here?

Jiao Yang:  The premise of your first question is that the exchange has been allocated to Shanghai.  However, I have not yet received any information confirming this report, which should be released and confirmed by state-level government departments.  If it were a decision by state-level departments, the Shanghai government will obviously offer all assistance and cooperation.

5.21st Century Business Herald:  I'm not very clear about the notion of "developing new socialistic suburbs" as mentioned by the spokesperson. Is there any difference between this and "new socialistic rural areas"?  If it is a new concept, what does it actually involve?
My second question is about the first central government document of this year, publicized yesterday by the State Council.  It notes that Shanghai holds a prominent position in China's economic landscape.  The city, in pursuit of the so-called urban-rural-dual-structure development model, has since last year piloted a trial reform program concerning infrastructure construction in Pudong.  How has this program progressed, and has Shanghai evolved any unique ideas or methods in developing the "new socialistic rural areas"?
One more question: what's the total investment in cooperative medical institutions and facilities? How is the operation going? I mean whether the investment is breaking-even, profitable or run at a loss? You mentioned "cooperative outpatient medical service".  Can you explain this? Thank you!

Jiao Yang: "The new socialistic rural areas" and "new socialistic suburbs" are one and the same concept.  Shanghai is firm in implementing the State Council's stratagem of developing new socialistic rural areas.  But, given the well-known fact that Shanghai is an international metropolis, the local municipal government and party have revised the goal to one of developing new socialistic suburbs while implementing the central development strategy.  It is in line with the central government's stratagy.

As for the finance and investment situation concerning the cooperative medical service in Shanghai's rural areas, I have just mentioned that, in 2004, 218 yuan per-capita was allocated to the medical fund.  Because the pathfinder document was drafted and completed in 2005, data from 2004 was cited as the benchmark.  It indicates that, currently, the per-capita funding raised for cooperative medical services has reached 218 yuan in all Shanghai rural districts excepting Fengxian and Chongming.
Fengxian is expected to reach the 218-yuan level in 2006 and Chongming to meet the target in 2007, according to the "Suggestions on improving cooperative medical assurance standards in Shanghai's rural areas".  Those areas already having approached the city's 2004  per-capita average should strive to further-increase their financing in parallel to local social and economic development.  Depending on the local circumstances of the districts and counties, the financing levels will vary.  But, the general goal has been set that, by 2007, financing for cooperative medical services in the rural districts and counties should not be less than the 2004 city average of 218 yuan per-capita and a long-term mechanism for financing should be in place. A range of measures will be initiated according to the particular circumstances of the districts and support will be granted to those considered more in need.  That's the principle of "providing specific measures to address a district's particular needs", as embodied in the new assurance rules.  For the districts and counties having lower medical capital, government financial support is cited as a must in the new rules.  The support includes government policy assistance, compensation for older farmers who are forced to leave the land as well as fiscal transfer payments to needy areas.  Thank you!

The spokesperson work team has just notified me that the full text of the "Shanghai Dangerous Chemicals Safety Management Regulations" is available online at the Shanghai government website

6. National Business Daily: My first question is what role corporations, particularly private firms, will play in the upcoming reform of the cooperative medical system.  On the taxi issue, has Shanghai any plans or new ideas to peg taxi charges to oil prices?

Jiao Yang: For the first question, the new assurance rules state that cooperative medical service coverage will be expanded under government guidance and via public participation and cooperation.  Therefore, to gradually improve the cooperative medical service in rural areas, we will raise the individual payments of farmers, reinforce government support, encourage contributions from collective economic groups or social organizations and attract participation from corporations.
As for the scheme to link taxi fares to fuel prices, the city is still studying it, with all related government departments contributing.  But it's still at the exploratory stage, and further necessary procedures have yet to be undertaken, such as the inviting of public views, holding public hearings and conducting thorough investigation of the options available.

7. Pudong New Area Weekly:  I have two questions.  The first is about the city's Dangerous Chemicals Safety Management Regulations.  The regulations state that both automatic cut-off of gas and liquid petroleum and anti-explosion devices are required at all service stations.  I'd like to know if this is mandatory, and if it is, when will all the service stations meet this standard?  How many sub-standard service stations are there in the city, and what proportion do they form of the total? And also what are their main distribution on the map? 
Now my second question. We all know that the Pudong new area is experiencing a huge wave of resident relocation to pave the way for the city's reconstruction.  Many farmers might move to the townships a day after their lands are requisitioned.  As a result, a problem with their insurance attribution comes up, namely whether they should continue to be covered by the rural cooperative medical-care insurance system or join the town social insurance system.  If the latter, can these people still benefit from cooperative medical treatment?  Can you explain the operational procedures in such cases? Thank you.

Zhang Zhongyu: We do require local gas and liquid petroleum stations to take precautionary measures against explosions.  The newly-built stations, I mean those put into operation last year, have taken these requirements into account early in the construction process.  So, for now, the focus of our work will be equiping the old stations.  This is a mandatory measure, a "must".  As for the practical issues of implementation, you may refer to the administrative department concerned.

Jiao Yang:  Just now, I explained the relation between town social insurance and rural cooperative medical-care insurance.  The people who participate in the former may at the same time benefit from the latter.  It's states clearly in the regulations that those covered by town social insurance can participate in the rural cooperative medical-care insurance system after paying 50 percent of the average premium for the rural cooperative paid in the previous year.  This sum of money will be directly debited from cooperative medical-care accounts upon application.  There are offices offering financial consultation on cooperative medical-care in every district.  People can refer to these offices if they have any problems on that.

8. China Economic Times: My question is for Director Zhang.  Would you please give us a clear picture of the administrative structure, by territorial jurisdiction and departmental responsibility, in relation to dangerous chemicals?  In addition, what are the  particular responsibilities of each department concerned?  Thank you.

Zhang Zhongyu: The administration of dangerous chemicals used to come under several specific departments.  However, there are now increasing numbers of small or medium-sized enterprises and which deal with dangerous chemicals opening in every district.  So, it's inevitable for us to adopt new administrative mechanisms to handle this.  Government at all levels should shoulder its responsibilities in this regard.  There are two main points here.  One is that the relevant authorities must take comprehensive measures on the administration of producers and dealers of dangerous chemicals in each district.  The second is that they must assist the city administration department in certain circumstance.  These two points are clearly made in the regulations.
As for particular departmental responsibilities, at the district-level, first of all, a supervisory system on dangerous chemicals administration has to beestablished.  Secondly, local government should help to prevent incidents occuring involving dangerous chemicals.  Last but not least, it should take charge of organizing first aid teams should incidents involving dangerous chemicals occur.
The above are the distinct responsibilities of the district-level administrations.  There is more to be done by other departments.  In addition to the Municipal Administration of Work Safety, others like the Public Security Bureau, Department of Transportation, Bureau of Maritime Affairs, Port Authority and the Shanghai Environmental Protection Bureau will more or less take charge of the administration of dangerous chemicals within their jurisdictions.

9. Yomiuri Shimbun (Japan): I just have one question. A few days ago, the president of the Liberal Democratic Party in Japan visited Shanghai.  The president met with city leaders and made a speech at a local university during his stay.  These were the two main events of his visit to Shanghai.  Can you comment on this?  Thank you.

Jiao Yang:  Excuse me; I am not very clear about the two events this Japanese reporter has mentioned.  I will try to find more information on that.  You might refer to the Shanghai Foreign Affairs Office after the press conference, as they will know all about this.  Thank you.

10. China Business News: I have some questions concerning the rural cooperative medical-care insurance system.  As you said just now that the figures differ between suburban districts, can you offer some examples?  It's said that the government is going to increase the financing of the fund.  So, what's the planned input figure and what proportion of the total input does it represent? 
There is still disparity in medical-care insurance levels between the central areas of the city and the suburbs.  Once the rural cooperative medical-care insurance system standards are raised, what kind of impact will this measure have on these disparities?  What are the expected changes if the gap between districts is narrowed? 
Lastly, can you explain the financing mechanism you mentioned just now; will the fundreceive a year-on-year increase in input? Thank you.

Jiao Yang:  We are now facing an imbalance in the financing for the cooperative medical-care insurance fund between the city's central areas and the suburbs.  The 218 yuan mentioned above was the average amount collected for the fund per person in 2004.  Figures in the districts with better financial environments, such as Pudong and Minhang, exceeded this average, even reaching 300, while some were obviously below.  This is the imbalance we are talking about, and the aim of the announced policies is to rectify it.  It's an ongoing project. 
As for the long-term mechanisms for financing and the input of the government, you may refer to the papers listed on the government's official web site at www.   It is regulated that the monthly average subsidy on cooperative medical-care granted to each rural resident by the municipal finance ministry is 20 yuan.  Not every person receives 20 yuan, some will be given more, some less, as 20 is the average figure.  At the same time, the focus of financial support from the government will be on the most needy areas and the seriously ill.  
The smooth operation of this long-term mechanism needs the support of both the municipal finance ministry and the government at all levels. 
As for the proportions, or who pays the bill, I have already mentioned that; payment contributions from individual rural residents in 2007 shouldn't be less than the 2.0 percent of their net income as was the case in 2004.  The contribution of individual payments to the medical-care insurance system should be at least 40 percent. of the total, with the government paying the same proportion as individuals and the balance coming from the social fund.

11. Shanghai Securities News: I have two questions.  As the blueprint of the comprehensive reforms for Pudong has been approved recently, can you reveal the detailed reply of the relevant administration on that?  And when will this blueprint be released to the public?
Secondly, what's the total sum to be put into the rural cooperative medical-care insurance fund by town and district-level governments and the municipality itself in 2006? Thank you.

Jiao Yang: You implied the reform proposals concerning Pudong had been sanctioned. That is not exactly right. Let me put it this way. The Reular Session of the State Council has granted the city's request to introduce reforms in Pudong. The departments concerned are working in unison to formulate the reform plans, and are conducting research on where and how to commence the reforms. We will also seek the support of the central government, and advance the reforms together with the central government departments concerned. Local government will achieve a greater degree of autonomy over the reform. A reform is a gradual process. It is impossible for us to list all the things we want to do and implement them all at once. There is a lot to do before we can work out a detailed plan and then implement it. Our methodology is that if an idea matures and the cirumstances are appropriate, we will give it a go. An idea will be put into practice when the time is ripe. I don't know whether you have noticed that the subject of reforms in Pudong has attracted a great deal of media attention recently. As a large project, the scheme will contain a package of reforms. The media should publicize the progress that Pudong achieves towards fulfilling the central government's tenets of the "three emphases" and the "four moves toward integration".
Some projects have already been launched in Pudong. For example: The People's Bank of China, the country's central bank, officially opened its second headquarters; Shanghai customs has launched a pilot scheme which includes eight new measures; also being piloted are nine new measures which the State Bureau of Foreign Exchange plans to introduce to reform foreign exchange controls as they relate to multi-national corporations; the supervisory department is conducting pilot projects; the Administration of Industry and Commerce is set to introduce three pilot projects; and the city's 30 new policies to promote the modern service sector will be introduced on a trial basis there. In essence, we will ensure the smooth-running of Pudong's reform process.

12. Phoenix TV: According to the statistics released today by the office of the Central Finance Pathfinder Group, urban dwellers earned 3.22 times more than rural people last year, indicating that the gap is widening. The National People's Congress (NPC) and the Chinese People's Political Consultative Conference (CPPCC) will soon begin their annual sessions. Since an important goal set for the period of the 11th Five-Year Plan is "to build a new socialist countryside," it is a matter of great urgency that the income gap between urban and rural areas be narrowed. What do you think of the local situation if comparing it with the statistics released by the office of the Central Finance Pathfinder Group? My second question is about the rural medical care system. You have just said that the health care systems in Chongming County and Fengxian District are still far from satisfactory. What are the minimum premiums charged by the medical insurance programs in these areas? What will be the ratio between the premium charged by the rural medical insurance program and that charged by the urban program in 2010, or the end of the 11th Five-Year Plan period?

Jiao Yang: Your questions are very specific. I have no statistics to hand. The Shanghai Municipal Bureau of Statistics released the data on the incomes of urban and rural dwellers at the previous press conference. In fact, the average income of local farmers has risen by 10 percent-plus for two consecutive years. Of course, the urban-rural gap still exists and the municipal government has taken various measures to narrow it. More detailed information and the statistical data can be accessed on the official website of Shanghai Municipality.

13 Youth Daily: I have two questions. The first one is to Director Zhang. We have noticed that the city¡¯s regulations on the safety management of dangerous chemicals stipulate that dangerous chemicals will only be transported in the city by licensed firms following the required safety precautions. Does this mean that all the dangerous chemicals bought by local residents should be delivered by licensed transport companies from now on? How can they make use of the service, and will it be free of charge? My second question is to the government spokeswoman. The State Council has made new regulations covering recreation facilities, which will come into effect in March. Under the regulations, all recreation facilities should be closed to the public between 2 am and 8 am. However, many local karaoke bars earn much of their money by providing all-night service. Some karaoke owners say they will not admit new customers after 2 am, but they will not ask those already inside to leave. What is the government's view of this statement? Has the government taken measures to enforce the State Council's new regulations? Thank you.

Zhang Zhongyu: Article 29 of the the city¡¯s new rules concerning chemicals gives a detailed explanation of the centralized distribution system. The clause states that "any company selling dangerous chemicals to local residents or institutes (for instance, schools, hospitals and research centers) must ensure that the chemicals are delivered by authorized firms".

Jiao Yang: As to your second question, I believe Shanghai will strictly enforce the State Council's regulations concerning the opening time of recreation facilities. Club owners are not entitled to interpret government policies. The government departments concerned will draw up detailed plans to fulfill the State Council's requirements, of that you can be sure.

14. Oriental Morning Post: My first question is about the rural cooperative medical care system. Shanghai began to implement the system many years ago. Has it produced the desired effect? Has the city achieved any progress in ensuring that farmers suffering serious illnesses are able to bear the medical expenses? My second question concerns dangerous chemicals. The new rules will soon be enforced. I'd like to know whether Shanghai has experienced any accident caused by dangerous chemicals, and if so what was the outcome? Did the government draw up the regulations against the background of a previous accident?  

Jiao Yang: The rural cooperative medical care system has been operating in Shanghai for 48 years. In 1997, the government began to advocate a new rural cooperative medical insurance system involving the participation of farmers while being led and subsidized by the government. A primary feature of the system is mutual assistance. Farmers suffering from serious illnesses can have their medical treatment subsidized. Under the system, farmers suffering minor illnesses can get grants from the town or village governments, while those catching serious diseases receive funding from the district or county governments. At present, 75 percent of local farmers receive medical treatment at village clinics, 15 percent at town-level clinics, and less than 10 percent visit hospitals at district, county or city level.
On the whole, the local rural cooperative medical insurance system works well. With efficient use of public funds, the system manages both to minimize financial risks and ensure financial protection for everyone. It plays a key role in ensuring that farmers suffering serious illnesses can afford the cost of treatment. At present, about 20 to 30 percent of the funds raised for the system are designated to subsidize farmers whose annual medical expenses exceed 5,000 yuan. According to statistics released on December 20, 23,700 farmers received an average subsidy of 4147.77 yuan for their medical bills last year. Of these, 200 were offered the maximum subsidy permissible. Thanks to the system, the financial burden of farmers are lightened and more farmers are able to pay their medical bills. Farmers having minor illnesses can receive medical treatment at village and town clinics, while those suffering serious diseases can obtain government subsidies. Therefore, the rural cooperative medical insurance system is beneficial to local farmers, and the use of funds is highly efficient. 

Zhang Zhongyu: The reporter inquired as to whether any major accident involving dangerous chemicals has occurred in Shanghai. I can say definitively that Shanghai has never experienced an incident involving dangerous chemicals that has led to mass casualties or other serious consequences. The municipal government decided to introduce the new rules in view of recent incidents involving hazordous chemicals that have occured both at home and abroad. These incidents remind us that big cities like Shanghai should take precautions and adopt safety regulations. Prevention is better than cure, as the saying goes.