We need to foster a free and open environment for trade and investment, and gear up innovation cooperation. Innovation of our age is open in nature. Trade liberalization and investment facilitation are as important to innovation as fresh air is to human beings. China and Germany have both contributed to and benefited from economic globalization. We both stand for free trade. China has always approached trade issues from an overall and long-term perspective. China has a long-standing trade deficit in both goods and services with Germany, and we hope to see more balanced trade between the two countries. Yet, we don't think this shall be achieved through trade protectionism. Rather, we should expand our trade by opening our markets to each other, and address the issue of trade imbalance in the course of development. We encourage more imports of quality German goods and welcome German investment in China. We want to promote mutual openness on an equal footing with Germany and all other EU members and create a more friendly and fair environment for bilateral cooperation on innovation. We also hope that Germany and other EU members will loosen restrictions on high-tech exports to China, and provide Chinese companies with equal treatment in investment review and greater visa facilitation.
We need to strengthen policy support to boost China-Germany innovation cooperation. The flame of innovation needs to be fueled by sound policies. China stands ready to work with Germany to consolidate diplomatic, economic, industrial and scientific resources, step up input from public sources and improve bilateral funding mechanisms. The China Development Bank will launch the second phase of the special loan scheme for Chinese and German SMEs. China supports innovation entities from both countries in forging alliances on smart manufacturing, scientific and technological innovation and vocational education. We should deepen cultural and people-to-people exchanges by encouraging interactions between our students and young scientists, implementing the intern exchange program and ensuring the success of the first youth innovation and entrepreneurship week. In the process of innovation cooperation, China strictly protects IPRs of enterprises and does not require compulsory transfer of technology. We welcome German companies to explore business opportunities in China's new energy vehicle market. Cooperation in third countries is an important area of China-Germany innovation cooperation. Our joint training program for mining professionals in Afghanistan can offer useful experience for our cooperation in Africa and other developing countries.
Ladies and Gentlemen,
Now, let me give an update on the Chinese economy, which may be of interest to you. This year, the Chinese economy has posted stable performance and moved in a positive direction, with major economic indicators surpassing expectations. In the first quarter of this year, China's GDP expanded by 6.9 percent. In the first four months, fiscal revenue increased by 11.8 percent, the fastest growth in the same period since 2013. Corporate profits in the industrial sector rose by 24.4 percent, reflecting greater efficiency in economic growth. In particular, employment is steadily rising. A total of 4.65 million new jobs were created in the cities, and the surveyed unemployment rate of major cities was around 5 percent in April. Economic indicators such as cargo volume, electricity generation, and port throughput continued to increase in May. For 10 months in a row, PMI has stood above the 50-point mark indicating economic expansion. Most notably, PMI of small manufacturing companies has increased for the third consecutive month, which is a sign of continued improvement in the performance of traditional drivers.
New technologies, industries, businesses and models are thriving. High-tech and service industries continue to outperform general industries in growth. The non-manufacturing business activity index is approaching a three-year high. Online retail sales of goods and services have increased by over 30 percent year-on-year. All these encouraging changes in the Chinese economy have been the result of deepened reform and innovation, especially major progress in advancing supply-side structural reform.
We have readjusted macro regulation in an innovative way. Despite downward economic pressure, the Chinese government did not resort to massive stimulus measures, but relied on reform and innovation to stabilize growth, restructure the economy and fend off risks. We have maintained the continuity and consistency of our macro-control policies, and continued to pursue a proactive fiscal policy and prudent monetary policy. The fiscal deficit ratio has been kept below 3 percent. The government debt-to-GDP ratio last year was 36.7 percent, lower than the 60 percent alarm level of the EU and among the lowest in the world's major economies. Moreover, it has been kept stable over the last two years. As for local government debts, they are mostly used to support investment in public projects. These are asset-backed debts with sound guarantee for repayment. The risks are by and large under control.
M2 growth has been on a downward trajectory since 2013, and fell to 10.5 percent at the end of April this year. The relatively high leverage ratio in non-financial companies has to do with China's high household savings and credit-dominated financing structure. Non-performing loan ratio of the banking sector is stabilizing and relatively low compared to other countries. Commercial banks have relatively high capital adequacy ratio and provision coverage ratio. Household savings rate is close to 50 percent, which is about twice the average of major economies. Since the beginning of this year, the IMF has twice revised its growth forecast upward for China, and suggested on several occasions that China's financial risks are controllable and that the value of the RMB is broadly in line with China's economic fundamentals. We still have plenty of "tools" in our toolbox for innovation in macro regulation, and we are fully capable of defending the bottom line of no outbreak of systemic or regional risks.
We have innovated the model of administrative management. We have continued with the reform to streamline administration, delegate powers, enhance regulation where necessary and provide better services. This government has removed 40 percent of the items that previously required administrative approval of State Council departments, and stepped up efforts to cut taxes and fees. These measures have reduced the institutional transaction costs and burdens on companies, and stimulated the dynamism of market players at the micro level.
In the past three years, 12,000 new companies got registered each day in China. In the first four months of this year, the number has exceeded 15,000, and about 70 percent of the companies are active in operation. There are now more than 4,000 maker spaces in China. Together with some 3,000 high-tech incubators and over 400 start-up accelerators, they form a complete chain of start-up incubation services. New industries are thriving, and traditional industries are brimming with new vigor through transformation and upgrading. The new drivers are playing an increasingly important role in stabilizing growth and boosting employment. Although they cannot yet compare with traditional drivers in size, given time, they will open up broader space for China's economic development.
We have innovated the open economic system. We have initiated a new round of high-standard opening-up with the goal of promoting development through openness. In 2015, we amended the Catalogue for the Guidance of Foreign Investment Industries for the sixth time, cutting the number of restricted industries by half. In the latest amendment this year, the number of restricted industries has been reduced by another one third. In 2013, China's first pilot free trade zone was set up in Shanghai, and now the total number has reached 11. The negative list model of foreign investment management is being rolled out nationwide. With the exception of a few sectors, the establishment and major adjustments of foreign-invested companies are now only subject to a simple filing process with the relevant authorities, rather than review and approval. Even with a 13 percent fall in global cross-border direct investment last year, paid-in foreign investment in China has maintained its steady growth, reaching 133.7 billion U.S. dollars in total, still ranking China among the top three in the world. All this fully shows that China remains a competitive and appealing destination for foreign investment.
Ladies and Gentlemen,
Today is the International Children's Day. Children represent hope and the future. China-Germany innovation partnership, which is now off to a good start, is like a child filled with the energy of life and a promising future. I am confident that with the careful nurturing of both sides, China-Germany innovation cooperation will grow into a strong pillar for the development and cooperation of our two countries.
Thank you. Enditem
