Foreign Ministry Holds A Briefing For Chinese and Foreign Media on President Hu Jintao's Visit to Canada and Presence at the 4th G20 Summit
On June 18, 2010, Foreign Ministry held a briefing for Chinese and foreign media. Vice Foreign Minister Cui Tiankai, Vice Minister of Finance Zhu Guangyao and Zhang Tao, Director of the International Department of the People's Bank of China, respectively introduced the background, main activities and major significance of President Hu Jintao's state visit to Canada and presence at the fourth G-20 summit in Toronto from June 23 to 27, 2010. Qin Gang, Deputy Director-General of the Information Department hosted the briefing in which nearly 100 Chinese and foreign journalists participated.
Cui first of all introduced the visit and the summit:
I. President Hu's State Visit to Canada
Cui said that President Hu's visit is the first visit of the Chinese head of state to Canada over the past 5 years and, as a major event of bilateral relations on the occasion of the 40th anniversary of diplomatic ties between China and Canada, has great significance to the development of bilateral ties. China-Canada relations have gained long-term progress since the two countries established diplomatic ties in 1970. The high-level and other levels of exchanges between both countries remain frequent. Bilateral cooperation in a wide range of areas including economy and trade, energy and resources, education, science, culture, health and environmental protection enjoys fruitful results and cultural exchanges keep expanding. The two countries also cooperate closely on major international and regional issues. In 2009, the bilateral trade volume reached US$29.7 billion. China has become the 2nd largest trade partner of Canada while the latter is the 13th biggest trade partner of the former. Prime Minister Stephen Harper visited China successfully in December last year, and both sides issued the guiding document China-Canada Joint Statement on bilateral relations. The bilateral ties have maintained a sound momentum of development since the beginning of this year and face important opportunities.
He noted that both China and Canada are countries with important influence in the world. No matter in terms of promoting the sustainable development of domestic economy and world economy or in terms of handling regional hotspot issues and global challenges and maintaining world peace and stability, both countries enjoy wide common interests and extensive foundation of cooperation. We are glad about the development of bilateral relations over the past 40 years and believe the bilateral cooperation has great potential.
He indicated that President Hu will meet with Governor General Michaelle Jean and Prime Minister Stephen Harper respectively during the visit to share in-depth views on China-Canada relations and the international and regional issues of common concern. President Hu will also meet with other Canadian leaders and contact the Canadian people from all walks of life. Related government agencies and enterprises of both countries will sign a number of cooperation agreements. With the joint efforts of both sides, the visit will achieve full success. China expects to join hands with Canada to take the opportunity of President Hu's visit to further strengthen dialogue, exchange and cooperation on the basis of mutual respect, equal treatment and mutual benefit in order to push the bilateral relations forward from a new historical starting point.
II. President Hu's Presence at the Fourth G20 Summit
Cui noted that in addition to the leaders of G20 members, leaders of some Asian, African and European countries and regional organizations as well as senior executives of some international organizations like the UN, the IMF, the World Bank, the Financial Stability Council, the World Trade Organization and the International Labor Organization will be invited to the summit. According to the arrangement of the host country, leaders will participate in the working dinner, plenary session and working luncheon from June 26 to 27 to discuss the situation of world economy, the European sovereign debt crises, the Framework for Strong, Sustainable and Balanced Growth, the reform of international financial institutions, the international trade and financial supervision and other issues.
He said that the G20 summit is an important and effective platform of the international community to jointly tackle the global financial crisis and strengthen international economic cooperation. With the joint efforts of all parties, the previous three summits reached important consensus on many aspects. The Toronto summit is the first of its kind held after the institutionalization of the G20 summit and serves as a major link between the past and the future. The Chinese side hopes related parties continue to follow the spirit of helping one another, step up cooperation, comprehensively implement the consensus reached at the three previous summits, maintain the credibility and effectiveness of G20, consolidate its status as the major forum of international economic cooperation and achieve positive and practical results in the following five fields: first, comprehensively implement the Framework for Strong, Sustainable and Balanced Growth, strengthen the macroeconomic policy coordination of G20 members and consolidate the momentum of world economic recovery; second, try to complete the new round of share reform of the IMF before the G20 Seoul summit and fulfill the Pittsburgh summit commitment; third, continue to promote the reform of financial supervision and especially reinforce supervision on the credit rating agencies; fourth, continue to oppose all forms of protectionism and boost the Doha Round negotiations; fifth, pay greater attention to the development issue and provide political support for the UN Millennium Development Goals High-Level Meeting to be held in September.
Zhu introduced the policy preparations made for the Toronto summit not long ago by the meeting of G20 finance ministers and central bank governors. He said that the global economy in general remains stable and turns for the better at present. However, the process of recovery is still unbalanced and faces many uncertain and unstable factors and in particular the challenges caused by the European sovereign debt crises. The Toronto summit shoulders the critical historical mission of boosting the "strong, sustainable and balanced growth" of global economy. The G20 finance ministers and central bank governors mainly discussed the topics of what macroeconomic policy should be adopted by the G20 members and how to coordinate such policies, how to strengthen financial supervision and how to reform international financial institutions and reached consensus in the following aspects:
First, global economic and financial situation and the macroeconomic policy G20 members should adopt. The meeting pointed out that all countries should implement effective policies favorable to their economic growth according to their national conditions and ensure fiscal sustainability. Those countries which face serious fiscal difficulties should accelerate the pace of fiscal rectification. While maintaining macroeconomic stability, countries should try to expand domestic growth sources within their capacity. They should also implement monetary policy which is beneficial to maintaining price stability and boosting recovery, promote structural reform, push forward development, especially development of the poorest countries, reduce trade and investment barriers and oppose protectionism.
Second, Framework for Strong, Sustainable and Balanced Growth. The meeting discussed and coordinated the macroeconomic policy of different countries, deeply analyzed multiple possible prospects of global economic growth and agreed to take strong policy measures from the perspective of promoting stable public finance and balanced global economy, accelerating structural reform, strengthening financial supervision and improving monetary policy framework in order to realize the strong, sustainable and balanced growth of world economy to the maximum extent. Related policy proposals will be submitted to the Toronto summit for deliberation.
Third, strengthening financial supervision. The meeting agreed to strengthen management on the capital adequacy and liquidity of financial institutions, reduce the moral hazards of those financial institutions which have systematic influence, reinforce supervision on the hedge funds, credit rating agencies, salary of senior financial executives and OTC derivatives and build a globally unified high quality accounting standard. The meeting also agreed to develop principles on the cost of the financial sector to bear government assistance under the premise of respecting the national conditions and policy choices of different countries in order to reduce risks of the financial system.
Fourth, reform of the international financial institutions. The meeting extended welcome to the progress of voting right reform and capital increase of the World Bank and proposed to develop a set of dynamic adjustment formula to reflect the economic strength of countries and gradually reach the target of equitable sharing of the right to vote between developing and developed countries. It required the IMF to complete share reform before the G20 Seoul summit in November this year and step up governance reform in other aspects. It also agreed to strengthen the global financial system network in order to handle the impact of capital flow and prevent the spread of crisis at the country, region and multilateral levels.
Zhu said that the Chinese side stressed at the meeting in order to promote the stable recovery of world economy. Countries should maintain the continuity and stability of their macroeconomic policy; prudently determine the timing and way of exit in line with their national conditions; prevent and handle inflation and fiscal risks while boosting economic growth; oppose trade and investment protectionism and promote healthy development of international trade and investment. To realize the strong, sustainable and balanced growth of world economy, developed countries should take effective measures to solve their problems of weak growth and unsustainable finance, keep the relative stability of exchange rates of major reserve currencies and reduce fluctuation of international financial market; developing countries should accelerate economic growth through reform and structural readjustment.
Zhang introduced the significance of G20 to strengthen cooperation under the current situation and the Chinese side's position on reinforcing financial supervision and the IMF's reform. He said that countries should implement effective policies favorable to economic growth according to their own national conditions, ensure financial sustainability, push forward structural reform, expand domestic demand, encourage demand of the private sector, boost confidence of market, enterprises and individuals and promote the strong, sustainable and balanced growth of world economy. The Chinese side supports the proposal of the Financial Stability Council and other international organizations on reinforcing financial supervision. To strengthen the management framework on the financial institutions' capital adequacy and liquidity helps to increase their ability to resist risk. Meanwhile, supervision on credit rating agencies should be strengthened, supervision models should be explored and dependence on external credit rating agencies should be reduced. We appeal to all countries to jointly promote the IMF's share reform in a pragmatic attitude and fulfill the political commitment of G20 leaders of transferring at least 5% of share to the emerging markets and developing countries as scheduled. We also support the IMF in reforming its governance structure and functions.
The above-mentioned officials also answered questions of journalists on the G20's role of coordinating countries' efforts to tackle the international financial crisis, the impact of the European sovereign debt crises on China's economic policy and how to strengthen fiscal rectification.