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    China’s Development and China-Europe Cooperation: Sources of Positive Energy for the World


    – Speech by H.E. Yang Jiechi, State Councilor of the People’s Republic of China, at the French Institute of International Relations

    2016 4 14

    14 April 2016



      Mr. Thierry de Montbrial, Executive Chairman of the IFRI,

      Ladies and Gentlemen,

      Dear Friends,


      Good afternoon. I am delighted to come back to this magnificent city for this year’s China-France strategic dialogue. Yesterday, shortly after I arrived in Paris, I had meetings with President Hollande and Foreign Minister Ayrault. This morning, I had a candid, in-depth and productive discussion with Mr. Jacques Audibert, President Hollande’s diplomatic advisor. We reached broad agreement on bilateral ties and major regional and international issues.


      The French Institute of International Relations is a leading think tank in France and in Europe as a whole. This institute and all of you present today have made important contribution to the mutual understanding between China and Europe in general and between China and France in particular. Let me salute you and thank you for your worthy efforts.


      I last visited the IFRI six years ago, at a time of deepening global financial crisis and worsening debt problem in this part of the world. The world economy was on the brink of a deep recession. Against that backdrop, the Chinese economy was among the first to turn around, and together, China and Europe sent a powerful message of jointly tiding over the difficult times and pledged to strengthen strategic cooperation based on deepening trust, equality and mutual benefit.


      Now, six years on, the world economy is yet to emerge from the crisis. It still faces daunting challenges for strong growth. While the Chinese economy is in a new normal of adjustment and reform, the European economy has turned the corner and entered a new phase of steady growth. As China and Europe become increasingly interdependent, we also face a growing number of common challenges.


      A friend in need is a friend indeed. It is exactly in the course of jointly confronting the financial crisis and global challenges that good chemistry occurs between China and Europe. Increasing communication has brought us closer to each other. More and more Europeans have developed a keen interest in China. They want to know more about China. And they are ready to listen to China.


      At the moment, how the Chinese economy is doing is a topic of great interest, and this is what I have to say to you. There are many around the world who are optimistic about the Chinese economy. They believe that the new normal in the Chinese economy should be viewed in an objective light and that other countries should readily get accustomed to it. But there are others who have misunderstanding and even bias about the Chinese economy, worrying that it might make a hard landing or even drag down the world economy.


      What is the real picture then? Let me share with you one latest figure released by China’s National Bureau of Statistics early this month. China’s?PMIin the month of March rose above 50%, the departure point between expansion and contraction. And in recent months, investment in fixed assets has rebounded, the housing market has picked up, and the economy as a whole has regained its momentum of growth.


      The Chinese economy, however, still faces a downward pressure. What’s more, transformation and upgrading are invariably accompanied by some “growing pains”. We will not evade those problems or deny their existence. Rather, we will rise to the challenges with every confidence. People with an objective and comprehensive perspective will see that as an anchor and a source of growth for the world economy, the Chinese economy will continue to inject positive energy to the global economic growth.


      Such positive energy comes from China’s enormous contribution to the world economy. China’s GDP grew by 6.9% last year. The moderated growth rate is actually the intended result of China’s structural adjustment. The old growth model would certainly have secured China a higher growth rate. But we now value quality as much as speed, if not more. Even a growth rate of 6.9% still places the Chinese economy at the forefront of major economies and represents the biggest increment in the world, equivalent to the GDP of a middle-income country. According to the IMF, China will be contributing 30% to global economic growth up to 2020. And it is worth noting that China is becoming a major contributor to global consumption and investment. For three years in a row, China leads the world in the number of outbound tourists as well as the amount of money they spend. Last year, the value of wine China imported was up 34% year-on-year, reaching a record high of two billion US dollars. A significant amount of that was produced here in France. In the next five years, China will import goods worth over 10 trillion US dollars and make outbound investment of over 600 billion US dollars. Later this year, China will work with other parties to host a successful G20 Summit in the city of Hangzhou. We hope this Summit will help improve global economic and financial governance. Is China a liability or an asset for a slowly recovering global economy? The answer is all too clear.


      Such positive energy also comes from the good progress in China’s deepening reform. Guided by a vision of innovative, coordinated, green, open and shared development, China is steadily advancing its own structural reform in a bid to lead by example in the broader structural reform of the world economy. Such reform has proved effective. Consumption has overtaken investment as the key driver of the Chinese economy. The share of the services sector in GDP has exceeded 50%. And a more telling sign is that household income and spending are growing faster than GDP. This is very much in line with China’s ultimate goal of development for better livelihood and seen as a new yardstick for China’s economic performance. Inspired by the government’s call of “mass entrepreneurship and innovation”, 12,000 new businesses get registered every day. Many of them are in such “new economy” sectors as Internet Plus, the Internet of Things and e-commerce. In the coming five years, 50 million new jobs will be added, ensuring adequate employment despite a moderated growth rate. The supply-side structural reform that China is pushing forward will further unlock growth potential. I’ll just give you an example. In China, a country with near one fifth of the world’s population, the number of civilian airports is only one twelfth of the world’s total. This illustrates the immense room for growth in China’s infrastructure and services sectors. Some China observers have pointed out that the traditional way of economic analysis, with its excess focus on data in the industry sector, can no longer capture the whole picture of a Chinese economy in transition with structural changes. I think they have made a point here.


      Such positive energy also comes from China’s resolve and seriousness about opening up further. When it comes to opening-up, China will not shut its door again or backtrack. Because we are keenly aware that retrogression or departure from the opening-up policy will lead us nowhere. China is striving for new progress in its all-round opening-up endeavor. It will widen market access and work on institutional improvement. The Chinese government has taken far-reaching measures to streamline administration and delegate power in the past couple of years. The purpose is to let the market play a decisive role in resource allocation. China has started its new round of reform and opening-up with a pilot free trade zone in Shanghai. New measures introduced in this pilot project, most notably the three lists for government administrative approval, i.e. negative list, accountability list and power list, have gone a long way towards trade facilitation. Such new measures will be rolled out to China’s central and western regions. We will open wider the services and financial sectors and increase market access in an orderly manner. We are committed to facilitating exchanges and cooperation between foreign companies, institutions and individuals with their Chinese counterparts. We will try to do a better job in all these areas. French companies were among the first to enter the Chinese market following China’s launch of its reform and opening-up program. Those French companies have expanded their presence in China in tandem with China’s deepening reform and opening-up. Just to name a few of them. French nuclear companies like EDF and AREVA have been running their business in China for over 30 years. They have established themselves in the world’s largest market for nuclear power. But more than that, their success has led to the thriving business of a large number of SMEs in France. The Taishan Nuclear Power Plant, which is still under construction, is expected to be completed next year and become the world’s first nuclear plant using third generation technology. PSA Peugeot Citro?n has seen its market share in China soaring and performance markedly improved since China’s Dongfeng Motor Group acquired its stake in 2014. Last year, the company turned around to make profits again. These are just a few examples of the kind of cooperation benefiting our two countries.


      In short, while a growing China has benefited from the world, it will ensure that its own development benefits the world as well. Benefits of development and opportunities for cooperation are what China has to offer to the world.


      Ladies and Gentlemen,

      Dear Friends,


      As China continues to grow and gets more integrated into the world, the international community is following with great interest not only how its economy is doing but also where its diplomacy is heading. This is especially true for the past few years. China has been more proactive on the diplomatic front to develop friendly ties with other countries. It has also become more active in providing better and more public goods to the world. Such efforts have been well received by many in the world. Nevertheless, there is still speculation about the so-called China’s strategic intention. As a matter of fact, China’s strategic intention cannot be more clear-cut. What we seek are the fulfilment of the two centenary goals (i.e. to complete the building of a moderately prosperous society in all respects and double China’s 2010 GDP and per capita income by the time the CPC celebrates its centenary in 2021; and to build China into a modern socialist country that is prosperous, strong, democratic, culturally advanced and harmonious by the time the People’s Republic of China celebrates its centenary in 2049) and the realization of the Chinese dream of great national rejuvenation. At the same time, we will promote peace and development of the world and work with other countries for a community of shared future for all mankind. China’s development will only mean a greater force for peace and more positive energy for the world.


      We are committed to a path of peaceful development. We are determined to blaze a new path of peaceful development of a major country in line with our national interests as well as the call of the times for peace, development, cooperation and mutual benefits. We strive to develop ourselves by upholding world peace and better safeguard world peace by building up our own strength. Such a path is inspired by China’s history and culture and the fine diplomatic tradition of New China. It is consistent with China’s national conditions as well as the trend of the world. We know full well that in an increasingly globalized world of deepening interdependence among countries, only through peaceful development can China realize its ambitious goal of national rejuvenation and contribute more to the world. As we pursue peaceful development ourselves, we call on other countries to do likewise. Our commitment to peaceful development does not mean that we can allow our legitimate rights and interests or core national interests to be sacrificed.


      We are committed to win-win cooperation. China advocates a new type of international relationship centered on win-win cooperation in which countries seek to advance common development through joint efforts. True development should be development for all, and sound development should be sustainable. The international community should find a path of fair, open, comprehensive and innovative development and work for common development. To that end, China has proposed a?Silk Road Economic Beltand a?21st Century Maritime Silk Road. Under this initiative, we intend to promote international industrial capacity cooperation, deepen all-round, win-win cooperation with other countries in economy, trade, investment, industry and infrastructure, help the countries involved build capacity for self-development, and create more development opportunities for more countries. We have signed inter-governmental agreements for cooperation on the Belt and Road with over 30 countries, including some European countries. China and France were the first to cooperate in third-country markets, setting up a new model of North-South cooperation. Chinese and French companies are exploring and conducting three-way cooperation in various forms in such African countries as Nigeria, Uganda, Mozambique and Guinea. The Hinkley Point in the UK, a joint project that will involve Chinese and French companies, is another testament to the broad prospect and market space for tripartite cooperation.


      We are committed to building various partnerships with all countries. In today’s world, countries have intertwined interests and would rise and fall together. As such, we need to build partnerships with rich substance and in diverse forms at regional and international levels. These partnerships should be equal in nature, meaning that countries will enjoy equal rights and share same obligations with no one playing a more dominant or superior role. They should be peaceful and not targeted against any hypothetical enemy or third party. And they should be inclusive, including not just those who share the same ideal and follow the same path but also those who seek common ground while shelving differences. China has established different forms of partnerships with over 80 countries, regions or regional organizations in an effort to blaze a new trail for state-to-state relations featuring dialogue and partnership rather than confrontation or alliance.


      We are committed to resolving differences through peaceful means. Be it the Middle East and other international hotspots, or issues concerning China’s territory and maritime rights and interests, China has stayed committed to solving disputes through dialogue and negotiation. Together with European countries and other parties, we have made possible the conclusion of the comprehensive agreement on the Iranian nuclear issue. We have also been actively engaged in the pursuit of a political settlement of the Syrian issue. Dialogue and negotiation have proven the best way toward the most lasting solution at the lowest cost and minimal “after effects”.


      On the Korean nuclear issue, China is committed to achieving the denuclearization of the Peninsula, upholding peace and stability on the Peninsula, and resolving the relevant issues through dialogue and negotiation. Given the intricate and sensitive situation on the Peninsula, parties should implement the Security Council Resolutions in their entirety, avoid saying or doing anything that might escalate tensions, and refrain from taking any moves that might undermine the security interests of other countries and the strategic balance in the region. China will not permit war or chaos to erupt on the Peninsula or allow some countries to hurt its strategic interests under the excuse of enforcing sanctions. We have put forward the approach of advancing in parallel the denuclearization of the Peninsula and replacement of the armistice treaty with a peace agreement. This proposal reflects China’s commitment to building on the consensus accumulated during the Six-Party Talks, restoring trust among the parties, restarting dialogue and communication, and bringing the Korean nuclear issue under control and back to the track of negotiation.


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