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Before unilaterally initiating arbitration in Jan. 2013, Hua said the Philippines did not hold any consultations or negotiations with China on relevant items, much less exhaust "all bilateral means."

Xi encouraged them to take the lead in the innovation drive and contribute to the country's economic and social development as well as improvement of the people's welfare.

"More must be done to mobilize the enthusiasm and creativity of enterprises to make foreign trade more stable and stronger," Wang said.

Speaking highly of the friendship between the two countries in the past 55 years, Liu said it is of great political importance to bilateral ties to maintaining high-level party-to-party exchanges.

A more socially significant impact of the VAT reform is that it eases tax burdens for small- and medium-sized enterprises (SMEs), which experts say will encourage entrepreneurship and boost job creation.