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Remarks by H.E. Li Keqiang Premier of the State Council of the People's Republic of China At the Extended Session of the 14th Meeting of The Council of Heads of Government of Member States of The Shanghai Cooperation Organization

2015/12/15

Zhengzhou, 15 December 2015

Dear Colleagues,

It is a great pleasure to welcome you all to Zhengzhou, Henan Province, for the 14th Meeting of the Council of Heads of Government of Member States of the Shanghai Cooperation Organization (SCO). The SCO member states and observer states are all China's close neighbors. As we Chinese often say, a close neighbor is better than a kinsman afar, neighbors are like family members, and guests should be accorded with gracious hospitality. We hope that on China's Central Plains, which is known to the world for its profound history and rich culture, you will feel the warmth and hospitality of China, a country of etiquette and propriety. I also welcome Belarus for sitting in the meeting for the first time as an observer state.

Since its inception 14 years ago, the SCO has traversed an extraordinary journey. It has played a part in advancing equality, mutual trust and win-win cooperation and contributed significantly to the stability of the region and the well-being of its member states. We have signed the treaty on long-term good neighborliness, friendship and cooperation, established over 50 cooperation mechanisms at various levels and in various fields, formulated the multilateral economic and trade cooperation program and its implementation plan, and achieved good progress in practical cooperation across the board. At the Ufa Summit last July, President Xi Jinping and leaders of other member states adopted the SCO Development Strategy Towards 2025, charting the course for the SCO in the next 10 years and laying down the roadmap for mid- to long-term cooperation. And with the official launch of its membership expansion, the SCO has entered a new stage of development.

At present, the world economic growth is sluggish, and many countries are facing downward pressure on their economies. In the meantime, the international and regional situation has seen new complicating factors such as emerging geopolitical crises and the rising scourges of extremism and terrorism, posing unprecedented challenges of global impact to the international community. The SCO members are situated at where Europe and Asia meet, a region where different civilizations, cultures and religions of the East and the West converge. Peace, security and sustainable development of this region not only bear on the interests and well-being of the people of countries in the region, but also have an important impact on peace, stability, prosperity and development of the world.

An important subject of the meeting is to formulate new cooperation measures in alignment with the Silk Road Economic Belt and other initiatives. The goal is to make our efforts more practical and targeted, encourage all parties to explore new ways and ideas to jointly tackle external risks and challenges, promote common development and bring more benefits to the people in the region. China is ready to synergize its Silk Road Economic Belt initiative with the national development strategies of other SCO member states and the endeavors of the Eurasian Economic Union as well as other mechanisms to promote open, inclusive and shared development in the region. To this end, I propose that, while focusing on the three traditional areas of cooperation, namely security, economy, and people-to-people exchange, we strengthen, as a priority, six cooperation platforms of the Organization with a view to achieving concrete results in our friendly cooperation.

First, cement the security cooperation platform. The SCO member states, which account for three fifths of the total area of the Eurasian Continent and one fourth of the world's population, are a staunch force for peace and development of Eurasia. We are firm in upholding the post-war international order with the United Nations at its core and the spirit of the UN Charter; we are committed to peaceful settlement of international disputes; we stand for the principles of mutual respect and non-interference in other countries' internal affairs; and we advocate a new type of international relations featuring win-win cooperation. Given the resurging forces of terror and violence and the intertwining traditional and non-traditional security threats, we must use the SCO as a platform for solid security cooperation. We must leave no room for any force to jeopardize stability of the region, and we need to provide a strong guarantee for political security and social stability of the region. We suggest that efforts be made to increase coordination and communication in implementing the Border Control Cooperation Agreement among SCO members, speed up the signing of the anti-extremism convention,strengthen the drug control mandate of the SCO, and support the national reconciliation process of Afghanistan, thus fostering a reliable security environment for regional development.

Second, build the production capacity cooperation platform. SCO member states are now at a crucial stage of industrialization and industrial upgrading. We face the pressing task of improving our infrastructure and industrial system, and are all in urgent need of international cooperation on production capacity. As a Central Asian saying goes, herds thrive on the abundance of water and grass. The SCO member states have a big potential to tap in their market and resources. China's mature technology and quality production capacity could well be used to meet the development needs of countries in the region. We can provide affordable and quality equipment and project contracting services. We also welcome joint ventures to facilitate local production and processing in order to lower the cost of materials for infrastructure development, and create more jobs for the local people for mutual benefit. China's cooperation with Kazakhstan provides a fine example in this regard. The two countries have signed an intergovernmental agreement on production capacity cooperation and drawn up a list of 52 early harvest projects. Among those, the automobile assembling and polypropylene projects have been started, and more than 10 other projects will soon be launched in areas such as energy, mechanic manufacturing, chemical, metallurgy and cement. China is ready to share its experience of cooperation with Kazakhstan within the SCO. Cooperation efforts along the lines of government guidance, independent decision-making by enterprises and market-based operation could create an industrial cooperation chain that is internationally competitive, and lead to win-win results. Priority projects could be identified in light of the need of international production capacity cooperation.

Third, speed up the building of the platform for connectivity cooperation. Located along the Eurasian Continental Bridge, the major land transport corridor connecting Asia and Europe, the SCO member states have a huge potential for connectivity cooperation. When roads are built, prosperity will come. A regional transport network, when put in place, will go a long way towards helping member states accelerate economic development. Going forward, we may carry out key transport infrastructure projects in a planned and phased manner, and explore the possibility of forming a Eurasian connectivity network with Central Asia as the hub. China is ready to work with other parties to provide quality services for transit shipment of various countries. China also proposes to step up satellite navigation cooperation. The railway linking China,Kyrgyzstan and Uzbekistan is a signature project of regional connectivity promoted by the SCO. China believes that a working group meeting among the three countries needs to be convened as soon as possible for in-depth discussions on relevant technical issues.

Fourth, be innovative regarding the financial cooperation platform. Funding is the "blood" of practical cooperation. Regional economic cooperation would not be possible without flexible and effective investment and financing arrangements. Since its inception 10 years ago, the SCO Interbank Consortium (IBC) has carried out various forms of financial cooperation. We should continue to use this mechanism properly. So far, China has provided a credit line of US$27.1 billion for other member states, and set up the China-Eurasia Economic Cooperation Fund oriented towards the member states, observer states and dialogue partners alike, with the first batch of projects being launched already. Acting according to multilateral rules and procedures, China will actively seek support for SCO projects from the Asian Infrastructure Investment Bank (AIIB), the BRICS New Development Bank and other financial institutions. China will soon join the European Bank for Reconstruction and Development (EBRD), and has pledged to make contributions to the equity participation fund to be established by the EBRD. We are also ready to seek investment and financing support through this platform for projects of SCO member states. In addition, consideration may be given to establishing an SCO development bank at an appropriate time. China suggests that we task the meeting of finance ministers and central bank governors to speed up the study of the issue. China also supports expanding the local currency settlement arrangement among SCO members and calls for practical results in SCO currency swap cooperation with a view to jointly fending off financial risks.

Fifth, build the platform for regional trade cooperation. Expanding trade and promoting trade and investment liberalization and facilitation are vital to deepening regional cooperation. China has taken an active part in bilateral and multilateral free trade arrangements. So far, we have signed 14 free trade agreements involving 22 countries and regions. The combined GDP of SCO members is nearly US$13 trillion, yet the trade volume among us is relatively modest. So, much could be done on this front. Just now prime ministers of member states agreed to instruct their commerce ministers to carefully study how to effectively promote regional trade and investment liberalization and facilitation within the WTO framework and formulate feasible plans to this end. China also believes that the SCO E-commerce Union could be established as soon as possible to facilitate efficient and convenient cross-border e-commerce among companies of member states.

Sixth, build the platform for cooperation bearing on social undertakings and people's well-being. The purpose of cooperation is to pursue development, which is aimed at improving people's lives. As people living on the grassland often say, the carpet is the dream of carpet-weavers. Likewise, better mutual understanding and a better life are the common dream of the SCO family. China is ready to work with other countries to expand agricultural cooperation and ensure food security. The SCO environmental protection information platform is to be officially launched. And China will be happy to work with other parties to formulate and implement the plan of green Silk Road envoys. China supports the early launch of SCO youth exchange year. Each year for the coming five years, China will offer 20,000 government scholarships to other member states, starting from the 2016-17 academic year. China will step up personnel training for other member states, and will work to meet the target of training 2,000 professionals for other member states between 2015 and 2017. China is ready to better synergize its development strategy with those of the countries along the Silk Road. Furthermore, people-to-people exchange provides important support for cooperation in all fields. We suggest that member states simplify visa policies to promote personnel exchanges, and deepen cooperation in education, science and technology, culture, health, tourism and other sectors. I am confident that with these efforts, the profound friendship we have forged over the past 2,000 years and more will be carried forward to future generations.

Dear Colleagues,

As we Chinese often say, when put together, grains of rice can fill a basket, and drops of water can form a river. Likewise, the people of Central Asia believe that united efforts can melt hard rock. I am confident that as long as all parties uphold the "Shanghai Spirit" and take concerted and unremitting efforts, we will take SCO cooperation to a new high and bring greater benefits to the people of countries in the region.

Thank you.

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