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Promote Industrial Cooperation for Common Development

2015/04/28

Keynote Speech by Foreign Minister Wang Yi

At the Eleventh Lanting Forum

28 April 2015

Governor Zhang Qingwei,
Excellencies, Members of the Diplomatic Corps,
Distinguished Guests,
Friends,

Welcome to the eleventh Lanting Forum co-hosted by the Ministry of Foreign Affairs and the People's Government of Hebei Province. The forum is of special significance as it is the first time for the Foreign Ministry to join hands with a provincial government in hosting the Lanting forum.

We hope to achieve three goals with this forum: First, to provide a new platform for provinces and cities such as Hebei to expand exchanges and industrial cooperation with other countries, which reflects the top priority we place on promoting domestic development through diplomatic endeavors. Second, to share China's overall thinking on international industrial cooperation to gain greater understanding and support from the international community. Third, to encourage companies, experts, scholars and people from various sectors to contribute thoughts and wisdom to China's industrial cooperation with the rest of the world.

Friends,

China has all along been an important participant in international industrial cooperation. From the moment China opened its door to the outside world more than three decades ago, we have worked hard to attract production capacity, capital and technology from developed countries and the four Asian Tigers, which greatly facilitated China's economic take-off and the subsequent rapid growth over the years. Given our development level back then, we were at the lower end of the global industrial chain, and our overseas cooperation was mostly about "bringing in", rather than "going out".

More than thirty years' development has brought tremendous changes to China and elevated it to a whole new level in global economic structure and industrial chain. We have become the world's second largest economy, largest trader in goods, largest holder of foreign exchange reserves, third largest outbound investor and the largest trading partner for nearly 130 nations. As we continue to follow the policy of "bringing in", we are in a much stronger position to move our competitive production capacity to the wider world.

The world economy is still in the shadows of the financial crisis. The development gap among regions and between the North and South continues to widen and a new round of profound adjustment in capital, industry and technology is unfolding globally. This means both challenges and opportunities for us to draw on each other's strengths and pursue win-win cooperation. How to seize the opportunity to increase cooperation and strive for development and revitalization of all countries, developing countries in particular, is an important task for us all. China is ready to, in the spirit of win-win cooperation, open up wider, step up industrial cooperation with other countries, and integrate the Chinese economy into the world economy on a larger scale and at a higher level so as to realize common prosperity and progress for China and its partners.

To strengthen industrial cooperation is a sure path for China to accelerate economic transformation. After years of development, China has entered a more mature stage of industrialization with competitive industries and surplus capacity. China is the world's largest producer of over 220 categories of industrial products including steel, cement and automobiles. China produces 38% of the world's machine tools, 41% of ships, and 60% of power generation equipment. These are highly competitive industries and production capacity, not outdated or backward. China is speeding up economic structural adjustment, moving from the world factory to a global production base for sophisticated equipment. The relocation of high quality production capacity overseas is an important step to relieve relatively saturated domestic market and improve quality and efficiency of the Chinese economy. The successful upgrading of the Chinese economy in turn will lend a stronger impetus to world economic growth. This is good news for all countries.

Second, strengthening international industrial cooperation serves the needs of developing countries. Many developing countries in Asia, Africa and Latin America are in the early stages of economic take-off or industrialization and urgently need large amounts of external capital, equipment and technologies. Compared with other countries, China enjoys unique advantages in production capacity, such as advanced and operable equipment, mature and reliable technologies, cost-effectiveness and no strings attached. In addition, China has abundant capital and foreign exchange reserves and will make overseas investment of over US$650 billion in the next five years, which will provide strong financial support for China's industrial go-global effort. Given these factors, many developing countries are looking to have cooperation with China in production capacity and there is considerable space and potential for such cooperation. Let me give you an example. During his visit to Kazakhstan last December, Premier Li Keqiang put forward the proposal for industrial cooperation with Kazakhstan, which fits well with its development strategy and needs. In just several months, the two sides signed cooperation agreements in 28 areas with a total worth of US$23.6 billion. During my visit to five African countries early this year, I have keenly felt for myself the keen desire of African countries to speed up industrialization and achieve diversified development. Therefore, China's initiative for industrial cooperation with Africa has been greeted by active response and warm welcome from the African side. Many countries expressed the hope to be one of the first to benefit from production capacity to be relocated from China.

Third, strengthening international industrial cooperation is an important part of building the new-type international relations featuring win-win cooperation. In contrast to cold-war confrontation and zero-sum game practiced by certain major countries, China has been committed to a win-win strategy of opening-up and pursues win-win cooperation in political, economic, security, cultural and every other aspect of international cooperation. President Xi Jinping advocated the building of new-type international relations featuring win-win cooperation. It is not acceptable to have a few countries get richer while most others suffer from prolonged poverty and backwardness. While pursuing their own development, countries need to actively promote common development with other countries.

International industrial cooperation will help promote the free flow of resources, market integration and extensive sharing of the progress of development. It is an effective way to change the status quo of unbalanced development and unfair resource allocation in the world. As the largest developing country, China has the obligation, commitment and capabilities to provide impetus for the development of other developing countries. It is ready to take new investment opportunities to other developing countries through international industrial cooperation, help them improve infrastructure, obtain technological transfer, create more jobs and upgrade their capacity for independent development. This will help create development opportunities and tangible benefits to other developing countries and their peoples. China is also ready to work with other countries to achieve complementarity of advantages through industrial cooperation, and together make world economic governance more open, balanced, reasonable and inclusive and build a community of shared destiny and common interests among all.

Friends,

In strengthening international industrial cooperation, China will abide by the following principles:

First, a balanced approach to interests and principles. In our cooperation with other developing countries, we will stick to the balanced approach to interests and principles proposed by President Xi Jinping. We will try our best to accommodate their practical difficulties, and give them necessary financing and other support. We also ask Chinese companies to strictly abide by the law in doing business and fulfill their social responsibilities as they invest abroad, never pursue development at the cost of the long-term interests and the environment of their host countries, and never repeat the rapacious colonial way of "taking without giving".

Second, win-win cooperation. In our external cooperation, we don't seek to have all benefits to ourself. Rather, we will, on the basis of voluntarism, equality and mutual benefit, take into account the practical needs of the other parties, align the development strategies of both sides and promote industrial cooperation in a pragmatic and effective way. Our aim is to maximize win-win results. As for less developed countries, we will, in light of their conditions and development potential, help them turn their advantages in natural resources and labor into real drivers for independent development.

Third, openness and inclusiveness. China offers fully transparent and open cooperation, and will not engage in vicious competition that excludes third parties. While our current partners in industrial cooperation are mostly developing countries, we also welcome other countries including developed countries to join us in helping developing countries achieve rejuvenation. We are ready to explore industrial cooperation with developed countries on a higher level.

Fourth, market-based operation. We respect the status of companies as the main players and let the market play the decisive role in allocating resources. We will act in strict accordance with market principles, follow accepted international practices and support companies in independent decision-making and sole responsibility for their own profits and losses. On the other hand, the government will fully play its part in guidance, coordination, management and service. We will further improve the institutions and mechanisms, laws and policies, and financial services to encourage and support Chinese companies in going global.

Friends,

International industrial cooperation is a systemic project that needs coordination among all parties at home and abroad. The Foreign Ministry will continue to fulfill its responsibility in developing friendly relations with other countries and foster a sound and amicable external environment for China's cooperation with other countries. At the same time, we will actively support and work with the National Development and Reform Commission, the Ministry of Commerce and other competent departments to further improve the top-level design and strategic planning, so as to provide more effective institutional safeguards, policies and financial services to encourage and support Chinese companies in going global. We will work hard to build connections for competitive and credible companies and offer them sound guidance and services. These include better information support and consular protection to uphold their lawful and legitimate rights and interests abroad.

Hebei Province has long been strong in industries, boasting abundant capacity, advanced technologies and sophisticated managerial expertise in iron and steel, cement, glass, photovoltaic and other areas. As the Belt and Road Initiative advances across the board and as China and Africa jointly implement the "three networks and industrialization" program in Africa, the competitive industries in Hebei face a valuable opportunity to go global. I am sure this session of the Lanting Forum offers a good beginning. Hebei will seize the opportunity, fully leverage its advantages, and make continuous progress as a pioneer in external industrial cooperation.

Thank you!

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