On November 21, 2004, Chinese President Hu Jintao who was attending APEC's 12th informal leadership meeting in the Chilean capital of Santiago participated in the APEC Leadership Working Luncheon and the Declaration-Reading Ceremony. As requested by the leaders of the APEC members, Hu Jintao briefed them on the economic situation of China.

At the meeting, leaders of the APEC members positively commented China's economic development and showed high attention to China's economic development. Shortly after the start of the working luncheon, President Lagos of Chile invited President Hu to talk about China's economic development.

Hu said, in recent years, China's economy has maintained the momentum of sustained, rapid and sound development. During this process, some contradictions and problems also occurred in China's economic performance. The Chinese government has taken a series of policy measures to strengthen and improve macro control in response to those contradictions and problems. The work is done in two main categories: first, in order to solve the problem of imbalanced development between urban and rural areas, we focus on reinforcing agriculture and facilitating the increase of farmers' income. Second, given the excessive increase of fixed assets investment, we take economic, legal and, when necessary, administrative measures to suppress the blind expansion and low-level duplicated construction in some industries.

Hu noted that after the efforts of more than a year, China's economy continues to maintain the momentum of stable increase. China's grain production has shown a significantly favorable turn with a large margin of production increase. We can guarantee food security in China. Regarding the investment in fixed assets, it increased by 43% in the first quarter of this year. Yet the increase margin from January to September was 27%. China's GDP increased by 9.5% from January to September, and the increase for the whole year is estimated to be around 9%. All factors show that next year the Chinese economy will keep stable and rapid growth. The phenomenon of overheat in China's economy as expected by some people will not occur, and the "hard landing" of China's economy as worried about by some people will not occur either.

Hu said that we hope China's economic development will play a positive role in enhancing world economic growth. We are pleased to see that over this year, China's import from the United States, Japan, South Korea, ASEAN countries, Australia, New Zealand and Latin American countries have all increased. It is estimated that China's total import volume this year will exceed US$500 billion.

Hu Jintao stressed that in spite of the distinct achievements in China's economic development, the per capita GDP has just reached US$1000, and the economic and social development is not yet balanced. To achieve the goal of basic modernization in China, decades of efforts and hard work are needed, and a peaceful international environment is desired. China stands ready to strengthen reciprocal cooperation with other countries.

When talking about the financial situation in China, Hu said, with the deepening of reform and the expansion of opening up, profound changes have occurred in China's capital market. Last year, 95% of China's total investment came from business and bank financing and foreign investment and government investment accounted for only 4% which was mainly used in poverty relief, education, culture and social security.

Hu pointed out that we are carrying out financial reforms in a positive and stable manner. Two of the four state-owned commercial banks have been restructured and will be listed soon. The other two banks are making preparations to that end. We will, through reform, develop a more flexible RMB exchange rate forming mechanism which is more adaptable to market supply and demand changes, but this should be done step by step. Maintaining the basic stability of the RMB exchange rate at a reasonable and balanced level has bearing not only on the sound development of China's economy, but also on the stable development of Asia and world economy.

Hu's in-depth insights on China's economic development aroused the attention of the leaders of the other APEC members. Now and again they raised questions that they were interested in.

Hu attended the reading ceremony of the meeting's declaration after the luncheon. The Santiago Declaration of this meeting was published. The participating leaders reaffirmed their commitment to achieving sustainable and equitable growth and reduce economic disparities for the well-being of the people by meeting the Bogor Goals of trade and investment liberalization and facilitation, enhancing human security and promoting good governance and a knowledge-based society.

After the declaration-reading ceremony, APEC's 12th informal leadership meeting was concluded.