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Ambassador: An Open China Brings a Brighter Future for China-EU Economic and Trade Relations

(From Chinese Mission to the European Union)


Remarks by H.E. Ambassador Zhang Ming At the Luncheon Hosted by the Belgian-Chinese Chamber of Commerce

17 May 2018, BCECC

Mr. Bernard Dewit, Chairman of the BCECC,
Your Excellency Mr. Herman Van Rompuy,
Ladies and Gentlemen,

It is my great pleasure to be here today. For me, it's always delightful to talk to business friends. I would like to call you the non-governmental ambassadors between China and Belgium, as well as between China and the EU. Since the 1980s, the BCECC has made great contribution to the China-Belgium and China-EU economic and trade relations by connecting businesses from the two sides. Thank you for your hard work.

My message today is short and sweet: 1. China will be more and more open; 2. China-EU economic and trade relations have a brighter future.

Many European friends are following China's reform and opening-up with great interest, and hope to see the steady growth of China-EU relations in the long term. In a time of uncertainties, all eyes are on China and the EU to see how we could work together even more closely. These are topics I will cover in this speech.

Let me first give an update on China's reform and opening-up.

Forty years ago, China started reform and opening-up. Since then, we in China have made tremendous efforts to find a path of development suited to our own national realities, and to integrate into the world economy with a global vision. We are proud of the remarkable progress. I would like to share some figures which you may find convincing.

--In the past 40 years, China has helped over 700 million people get out of poverty, and its real GDP has grown by 9.3% annually on average;

--According to the World Bank and IMF, from 2017 to 2019, China is expected to be the biggest driver of the global economy, contributing 35.2% to global growth;

--According to the Credit Suisse Research Institute, of the 1.05 billion middle income people worldwide, nearly 35% are in China, while, in terms of population, China makes just 20% of the world's total;

--At the end of 2017, 772 million Chinese people had access to the Internet. Over 97% of them went online via a mobile phone. This was simply unthinkable 40 years ago.

--Last year, the number of Chinese companies listed on the Fortune 500 reached 115, going up for the 14th consecutive year. Well, forty years ago, not a single Chinese company could have such a global influence.

--According to the European Patent Office (EPO), China made 8,330 patent applications in Europe in 2017. The Chinese company Huawei topped the EPO's tally, with nearly 2,400 applications. Well, forty years ago, most Chinese didn't know what "patent" means at all.

These figures reflect how much we have achieved and how much we have brought to the world. Like the BCECC, I have personally witnessed the great changes in China since the start of reform and opening up. I have seen how the 1.3 billion Chinese people have created miracles with their hard work and with the support of their global partners.

For China to continue its success for the next 40 years, reform and opening-up still holds the key. The 19th Party Congress and the NPC&CPPCC annual sessions both reaffirmed China's commitment to the policy of opening up. In his Boao speech last month, my President, Mr. Xi Jinping, emphasized again that China will stay committed to the strategy of opening-up for win-win results, and made major announcements that aim to make the Chinese market more open and investor-friendly.

The commitment will be turned into concrete actions sooner rather than later. We have already set timeframes for this to happen. Measures on further opening of the financial sector and new energy vehicle sector will be put in place before the end of this year. In five years, we will remove foreign ownership limits on the whole auto sector. We will strive to connect the Shanghai Stock Exchange with the London Stock Exchange by the end of this year. We will host the first international import expo this November, and make it an annual event. We want to deliver the benefits of opening-up to companies and citizens around the world, which of course include BCECC members like you.

Please rest assured that China will keep to its long-term commitment of opening up and will enter a new phase of openness, supported by real actions. China's door will open wider at a reasonable pace. Opening-up is a set direction of our own choice, not something we are forced to do under external pressure.

Now let me turn to the second topic of my speech: China-EU economic and trade relations.

This year marks the 15th anniversary of the China-EU comprehensive strategic partnership and the 20th anniversary of the China-EU Summit. Thanks to decades of cooperation, China-EU relations have become more mature and stable. The economic and trade cooperation well illustrates this point.

The EU has remained China's number one trading partner for 14 years, and China the second largest trading partner of the EU. According to Chinese statistics, our bilateral trade reached 616.9 billion US dollars in 2017, up by 12.7% year on year. By March 2018, the EU has made nearly 122 billion US dollars of investment in China in accumulative terms, and Chinese stock investment in the EU is now over 80 billion US dollars. Economically, China and the EU are complementary and inter-dependent. Our cooperation benefits both sides.

Yet, we have no reason to be complacent. There is still a lot to be done. For instance, investment cooperation has huge potential. Currently, the EU's investment in China only accounts for 4% of the EU's total overseas investment, and Chinese investment in the EU only takes up 2% of all FDI flowing to the EU. This is not commensurate with the size of our economies. Therefore, a supportive approach is more helpful than tighter screening.

The Belt and Road Initiative (BRI) is another area where there could be more cooperation. China and the EU, each at the opposite ends of the Silk Road, are natural partners on the BRI. The initiative, connecting the Asia-Pacific and Europe, opens up great possibilities for cooperation.

In the next 15 years, China is expected to import 24 trillion US dollars of goods, make 2 trillion dollars of investment abroad, attract 2 trillion dollars of FDI, and see over 2 billion outbound visits to be made by its tourists. Clearly, China's development in itself is a source of great opportunities.

Speaking of tourism, as we mark the 2018 China-EU Tourism Year, many exciting things are waiting for us. For example, the EU will be made a Featured Partner Region at the Global Tourism Economy Forum to be held in Macau this coming October. I'm sure you could find many business opportunities.

That brings me to the third topic: HOW could China and the EU seize these opportunities to further enhance the commercial cooperation?

In the past seven months, I have been engaging with many European officials, entrepreneurs and scholars. I have also visited some Belgium companies and local authorities that have cooperation with China. I am deeply impressed and encouraged to see how much they hope to contribute to a more productive China-EU relationship. Please allow me to share a few thoughts on how we could make that happen.

First, it is important for China and the EU to jointly uphold the multilateral trading system. Faced with uncertainties at the global level, a stable China-EU relationship is a valuable asset for all. As major members of the WTO and comprehensive strategic partners for each other, China and the EU have great consensus on free trade and global economic governance. We have a joint responsibility to stand for the rules-based multilateral trade order, reject unilateralism and protectionism, and keep the world economy on the right course.

Second, it is important to focus on common ground and deliver more tangible outcomes. We need to ensure good implementation of the China-EU 2020 Strategic Agenda for Cooperation, further synergize our development strategies, and advance cooperation in connectivity, digital economy, legal affairs, and travel facilitation, among other areas.

Economic and trade cooperation is a major pillar of the China-EU relations. We have a lot to offer to each other and benefit from each other. The negotiation of a bilateral investment treaty is a priority for the two sides. We both want to reach an ambitious and balanced outcome as quickly as we can. So far, we have made good progress. A new round of talks is scheduled for next week in Beijing. Hopefully, more progress could be made before the China-EU Summit in July. As Chinese Ambassador to the EU, I am naturally more eager than others to see an early conclusion of the treaty, and I promise that I will spare no efforts to work toward this goal.

Third, it is important to properly handle differences in a smart way. Given the scale and intensity of our cooperation, it is natural for us to have competition and some frictions. But we must approach these "growing pains" with an open mind. After all, our interests converge much more than they diverge. We have effective mechanisms for dialogue and consultation, and we can rely on them to manage our differences. Let me emphasize again: we welcome more European investment in China. We expect the EU to keep its market open to Chinese investors as well and treat them fairly.

Ladies and Gentlemen,

We are fortunate to live in an age of great change. Change always means opportunity. People with vision are ready to seize them. I look forward to the continued efforts of BCECC and its members to build bridges between China and Europe, and contribute even more to the China-Belgium and China-EU relations.

Thank you for your attention.

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