Together, Take up the Heavy Responsibility of Promoting Steady Global Economic Growth

From: Ministry of foreign Affairs of the People's Republic of China Updated: 2013-01-26 14:07
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Premier of the State Council of the People's Republic of China
At the ASEM Summit

Vientiane, 5 November 2012

His Excellency Thongsing Thammavong, Prime Minister of the Lao
People's Democratic Republic,
Dear Colleagues,

At the outset, allow me to thank the Lao government for the thoughtful arrangements it has made for the meeting. When we met for the Seventh ASEM Summit in Beijing in the autumn of 2008, the full-blown international financial crisis was spreading quickly. On that occasion, we, colleagues from Asian and European countries, worked together and sent to the world a timely message of working together to tide over difficulties, which has increased the confidence and hope of the international community in getting out of the crisis. Over the past four years, Asian and European countries have steadily improved their domestic economic policies and adopted focused measures to address their prominent challenges and problems. In the meantime, these countries have stepped up dialogue and coordination on macroeconomic policies and deepened practical cooperation in various fields. All these efforts have yielded positive results and the global economy has been on the road to recovery.

Being a big responsible country, China has adopted an active and responsible approach in coping with the international financial crisis. China has managed its own affairs well and restored the Chinese economy to stability and achieved a steady and fairly fast growth in the shortest time possible. Committed to opening-up and cooperation, we in China have promoted a balanced growth between imports and exports and between attracting foreign investment and making outbound investment, and sent 33 big purchase missions abroad. As a result, we have helped create substantial demand and a large number of jobs in relevant countries and established a favorable environment for the development of multinational companies. We have taken an active part in global economic governance, helped push forward the reform of the international financial system, engaged in multilateral and bilateral dialogues, and extended a helping hand to countries with economic difficulties. Over the past four years, the Chinese economy has grown by an average annual rate of over 9%. Its total imports and exports have exceeded US$11 trillion, with imports approaching US$5.3 trillion. We have used over US$400 billion in foreign investment and made outbound investment of over US$250 billion. We have deepened the reform of the RMB exchange rate formation mechanism for a more flexible exchange rate. On the basis of the significant appreciation of the RMB in previous years, the real effective exchange rate of the RMB has again risen by 16%. The ratio of the current account surplus to GDP has dropped from 10.1% in 2007 to the current 2.6%. These figures demonstrate that China is an important engine for world economic growth and has played a crucial role in driving global economic recovery.

Since the start of this year, in response to a complex and grave international economic climate and weakening external demand, we have given greater importance to ensuring steady economic growth and focused our work on boosting domestic demand, consumer demand in particular. We have vigorously readjusted the economic structure and strengthened and improved macro regulation. These efforts have paid off. In the first three quarters, China's GDP grew by 7.7%. The Consumer Price Index was up 2.8% year on year. A total of 10.24 million new urban jobs were created. Imports and exports increased by 6.2%, with a greater equilibrium in the balance of international payments. In short, the Chinese economy has achieved steady growth. In September, major economic indicators registered an increase. The value added of above-norm industries rose by 9.2% in real terms year on year. Total retail sales of consumer goods were up by 14.2% year on year. Investment in fixed assets grew by 20.5% in the first three quarters. Exports increased by 9.9% and cargo volume by 11.8%. The Purchasing Managers' Index of the manufacturing sector rebounded for the first time in four months to 49.8%. And the Consumer Confidence Index rallied to 100.8. When all policy measures are put in place and produce results, the Chinese economy will head towards a steadier growth. We not only have confidence in meeting the development targets set for this year, but also have confidence, conditions and abilities to achieve development of a better quality, at a higher level and in the longer run.

Dear Colleagues,

The international financial crisis is not over yet. There remains a myriad of uncertainties and downward risks. The international community is expecting to hear words of wisdom and to see efforts pooled to overcome the crisis and effective ways found for economic revival. With a big population, rich resources and a vast market, Asia is the most vibrant region in the world. Europe enjoys a strong real economy, a well-developed market system and solid scientific and technological strength. Its status of being an important pole of the world will remain unchanged. Today, ASEM members account for roughly 56% of the global economy and over 60% of the global foreign trade. As long as we work in unison and cooperate with each other closely, we will certainly be able to shoulder the heavy responsibility of promoting a steady growth of the global economy, thereby giving the world confidence, courage and hope. In this connection, I would like to share with you my views.

First, free, open and fair international trade is an important driving force for world economic growth. Steady development of international trade would promote division of labor, expand the market and increase job opportunities. It is therefore in the interest of all countries. We need to widen market access with greater sincerity and resolve, reject trade and investment protectionism with a clear-cut attitude and actions, and properly handle trade frictions with sensible solutions. We must honor the commitment made at this year's G20 Summit to no new trade protectionist measures before 2014. We should update the ASEM Trade Facilitation Action Plan and Investment Promotion Action Plan as soon as possible with emphasis on closer cooperation in logistics, e-commerce, customs procedures, inspection and quarantine, infrastructure, investment access and exchanges between business personnel among other fields, and tap the huge potential in our business cooperation. China calls for the resumption of the ASEM Economic Ministers' Meeting so as to inject fresh vitality to ASEM economic cooperation.

Second, to enhance macro-economic policy coordination remains an important task. We ASEM countries should take a strong, sustainable and. balanced growth of the world economy as a common objective, stay committed to the macro-policy objective of maintaining growth and creating jobs, shore up market confidence and promote sound interaction between economies. We must watch closely the possible impact of the new round of quantitative easing (QE), a monetary policy introduced by major developed economies, and prevent drastic commodity price fluctuations on international market, disorderly global cross-border capital flow and greater inflation pressure on developing countries. We should continue to support, in a constructive manner, Europe in its efforts to settle the debt problem. Relevant European countries need to properly balance fiscal consolidation with financial stability and economic recovery. Major economies should work out their own unambiguous and reliable medium-term fiscal consolidation plans at an early date and properly resolve their government debt problems.

Third, to work together for innovations in science and technology is a fundamental way out for getting out of the crisis. Major scientific and technological breakthroughs in the wake of a large-scale economic crisis have always provided a new growth engine and enabled the world economy to regain equilibrium. The world is on the eve of scientific and technological revolutions. Asian and European countries should step up policy dialogue on science, technology and innovations, deepen exchanges and cooperation in this field, and sense the pulse of world scientific, technological and industrial revolutions. We should give priority to cooperation in clean energy, eco-protection, space, bio-tech, information and communications, sustainable urban development and others fields, encourage enterprises to establish joint R&D centers, technology transfer centers, joint incubators and other platforms for long-term and stable cooperation, and harness both Europe's strong R&D capabilities and Asia's big market potential for win-win results. Scientific and technological innovations know no borders. It is necessary to remove technical trade barriers and improve IPR protection systems. Developed countries should more vigorously support the growth of emerging industries in developing countries, instead of containing and suppressing it.

Fourth, a sound global economic governance system is an institutional guarantee for world economic growth. Notable achievements have been made in the reform of global economic governance mechanism in recent years. But to establish a fair, just, inclusive and well-managed international economic order remains an arduous task. To deepen reform of the international financial system, what is pressing now is to implement the 2010 quota and governance reform of the IMF, increase the representation and voice of emerging markets and developing countries, steadily move forward the reform of the international monetary system, build an international reserve currency system with stable value, rule-based issuance and manageable supply, earnestly advance the reform of the financial sector and reduce systemic risks of the international financial system. We ASEM countries should work for early and substantive outcomes of the Doha Round negotiations and for the establishment of a free and open multilateral trading system. We should make efforts to help shape an equitable and transparent commodity pricing and regulation mechanism to ensure global energy and food security.

Dear Colleagues,

China is a member of the big ASEM family and it champions and contributes to Asia-Europe dialogue and cooperation. In the past 16 years since the inception of ASEM, China has initiated and hosted nearly 50 important events and has been successfully elected as the new Executive Director of the Asia-Europe Foundation (ASEF). Approximately 50% of China's total foreign trade comes from its trade with other ASEM members, and about 20% of its utilized foreign capital comes from investment made by ASEM members. To further deepen practical cooperation between Asia and Europe, China hereby puts forward four new initiatives: (1) to organize a symposium to discuss ASEM's future development under new circumstances; (2) to establish an ASEM network for science, technology and innovation cooperation in water resources to increase exchanges and cooperation in water resources management and support economic and social development of Asian and European countries; (3) to carry out an ASEM model project on promoting cooperation in sustainable forest management and joint response to climate change; and (4) to give better play to ASEF. China will increase its annual contribution to ASEF to US$500,000 and hopes that all members will actively contribute to ASEF on a regular basis.

Over the years, I myself have been committed to Asia-Europe cooperation. I have attended five consecutive ASEM summits and witnessed the development of ASEM. I have truly seen ever clearer objectives, increasingly solid foundation and richer content in Asia-Europe cooperation. I am full of expectations and confidence in a new comprehensive partnership between Asia and Europe. It is my firm conviction that Asia-Europe cooperation holds promising prospects. Thank you.

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