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China's Development and China-US Relations
--Speech by Consul General Li Qiangmin at Luncheon of Asian Chamber of Commerce
2014/10/10

 

 

Thank you, Neil, for the kind introduction.

Dear Mrs. Crissy Rivera (Chair),

Dear Mr. Austin Zhao (Vice-chair),

Dear Mrs. Linda Toyota (President),

Ambassador Suk-bum Park (Consul General of Republic of Korea),

Ladies and Gentlemen,

Howdy!

I am very happy to be invited to speak at the Asian Chamber of Commerce. It is one of the most influential business organizations in Houston. Thank you for your longstanding efforts to improve the business exchanges between Houston and Asia.

China is the biggest trading country and second largest economy in the world. China’s new round of opening-up and reform present the world with great opportunities. Houston, as a dynamic economic and business hub in Southern US, will benefit from closer relations with China. I want to share with you the current situation of China’s development.

First, the basic statistics shows China’s economy remains in stable and healthy track.

-- In the first half of year 2014, China’s economy registered a 7.4% growth, and CPI rise was kept at 2.3%.

-- Because of the streamlining of administration, the number of newly registered companies increased rapidly and reached over 8 million.

-- The surveyed unemployment rate was kept at around 5% in 31 big and medium-sized cities between January and August. More than 9.7 million urban jobs were created, 100,000 more jobs than the same period last year.

It is not easy for China to maintain a strong growth momentum despite of the overall difficulties of world economy.

Second, the steps toward reform are steady and strong. The governmental departments have simplified approval procedures on more than 600 items by delegating more power to lower administrative bodies. The Shanghai Free Trade Zone (FTZ) is run under the negative list approach, which means investors not listed on the negative list may simply “file for record” and do not need to obtain separate approvals. As a result, the number of companies established in the FTZ has grown from 8,000 a year ago to more than 20,000 this year. We have adopted fiscal, taxation and financial measures such as tax reduction and reduction of required bank reserve ratio. The number of newly registered service businesses surged by more than 70%. The share of private investment in fixed asset investment increased by 1.4%. High-tech industries and equipment manufacturing grew faster than the industrial average. To provide a level playing field to all businesses and investments, China has started a war against corruption and strengthened antimonopoly law enforcement.

Third, the focus is more concentrated on improving people's livelihood. We continue to improve the social safety net and public services. And all businesses with annual income below $17,000 need only to pay half of their tax due. The 1.3 billion Chinese population represent the largest consumer market and source of demand in the world. We are doing everything to boost consumer spending, such as raising people's spending power, increasing supply of goods and services and reducing distribution costs.

Fourth, the development of China is never a process without challenges. As a matter of fact, China is faced with many challenges, for instance, the obvious uneven development between eastern coastal region and western hinterland and between urban and rural areas; the increasing environmental burdens that grows together with economic prosperity; the incremental downward pressure of economic driving factors, namely investment, export and domestic demand. Furthermore, there is still a lot to do for Chinese economic system to be fully integrated to the world.

These challenges occur during the process of development, and can only be addressed by development. We are confident that we can address these challenges and continue to make steady progress, because we have found the right path of development, that is the path of socialism with Chinese characteristics.

Fifth, China's development is an important part of global development and world peace. For China itself, more than 600 million of people have been lifted out of poverty. Globally, China was the biggest trading partner to 128 countries in 2013. Its imports of goods approached US$2 trillion. Non-financial investment to other countries exceeded US$90 billion. And almost 100 million outbound visits were made by the Chinese tourists. These figures, which keep increasing as we speak, will generate greater demand and opportunities in world economic growth.

Ladies and Gentlemen,

This year also marks the 35th anniversary of the establishment of diplomatic relationship between China and the US. The past 35 years have seen our bilateral relationship growing into one of the most important relationships in the world. Currently, our two counties are jointly building a new model of major country relationship, which features non-conflict, non-confrontation, mutual respect, and win-win cooperation. That’s the wise decision made by our two presidents, ensuring the China-US relations a healthy development in the future.

As to the bilateral agenda, China and the US share a lot of common goals.

-- Bilateral Investment Treaty (BIT). A bilateral investment treaty between China and the US is on the ‘fast track’. The first phase of BIT talks is likely to conclude soon, and substantive negotiations on the negative list will start immediately after that.

-- APEC. China and the US are committed to promoting economic growth and prosperity in the Asia Pacific. China is hosting APEC this year. We work closely with other economies to make the summit a success. We welcome President Obama’s trip to China for the APEC meeting and meeting with Chinese Leaders.

-- Longer Term Visa Arrangements. Both sides are committed to explore new proposals to significantly extend reciprocal visa validity for two-way tourists and short-term business travelers.

-- Military-to-Military Relations. The military leaders of the two sides agreed to develop China-US military-to-military relations by building on progress in developing a sustained and substantive defense dialogue, exploring practical areas of cooperation, and enhancing risk-reduction measures. We will have more exchanges and cooperation in areas of mutual interest, including counter-piracy, maritime search and rescue, humanitarian assistance, and disaster relief.

--Anti-Corruption and Law Enforcement Cooperation. The two counties share their commitments on tackling foreign bribery, denial of safe haven, and asset recovery.

As to the regional and global issue, there are a lot our two nations should do and can do together:

--Counterterrorism cooperation. Both China and the US are victims of terrorist attacks. Both are against all forms of terrorism and are committed to reinforcing counterterrorism cooperation. We are seeking practical ways to strengthen various cooperation including fighting against ISIS.

--Climate change. At the China-US Strategic and Economic Dialogue in July, we took important steps to advance cooperation to combat global climate change and work towards the common goal of low carbon economic growth. We already have the China-US Climate Change Working Group. They made a lot of progresses, in particular the launching of eight demonstration projects – four on carbon capture, utilization, and storage, and four on smart grids.

--Containing Ebloa. China strives to work jointly with other countries in addressing global challenges. Recently, China joined WHO and the US in helping West African countries fight Ebola. China has sent 174 medical staff to Sierra Leone and other affected countries. And on top of the previous two packages of assistance, China will provide another $33 million to these countries and $2 million to WHO, $2 million to African Union.

-- Addressing Regional and Global Challenges. Our two countries have good communication and coordination on regional and global issues such as the denuclearization of the Korean Peninsula in a peaceful manner, peacefully resolving the Iranian nuclear issue and the Syrian issue.

The door to China’s market is always open to the investors and enterprisers from the U.S. We wish the U.S. take the open trade and investment policies to China as well.

We kept calling on the U.S. to offer Chinese companies fair access to investing in the U.S. and avoid politicizing economic and trade issues. It's unfair that the U.S. still imposes high-tech export restrictions to China. Still China is excluded by US from satellite deal and access to commercial launch services, which hurts Sino-US space cooperation a lot. Moreover the telecommunication and network equipment from China’s Huawei and ZTE Corp was labeled with security risk and spying suspicion without any proof. World buyers are lining up to buy natural gas from US. As a non-FTA country, China is facing more obstacles than others to buy LNG. Because of the various restrictions, Chinese investors missed a lot opportunities in American market while American companies suffered a lot both in losing market share in China and in losing jobs and profits.

Houston has a reputation as the “Energy Capital of the World”. With the Johnson Space Center, Houston owns a strong economic powerhouse. According to a report by theTechAmerica Foundation, Texas surpasses California as top tech exporter. Therefore, to lift high-tech export restrictions to China will bring enormous benefits to Houston economy. As an influential business organization, you can join with us to work together to lift the restrictions and create new cooperation between China and US.

Ladies and Gentlemen,

The Southern part of the US plays an important part in the overall China-US cooperative relations. Since I assumed office in early May, I have visited a number of states and cities in my consular district. I am delighted and encouraged to see how strongly cooperation is going on between my consular district and my country.

Our trade is increasing, last year the two-way trade has increased to $112.9 billion, with Texas export to China alone exceeding $10.7 billion. Investment are growing year by year, now there are at least 150 Chinese companies investing in my consular district, with a total investment of over $15 billion in energy, manufacturing, shipping, real estate, IT etc. Our peoples are more connected than ever before, especially after the inauguration of Houston-Beijing, Dallas-Shanghai and Dallas-Hong Kong nonstop air services.

Another noteworthy development is that, during Governor Perry’s recent visit to China in early September, Texas signed an MOU and established a joint working group on trade, investment and educational cooperation with five Chinese provinces/municipalities, namely, Tianjin, Shangdong, Jiangsu, Fujian and Sichuan. This will certainly boost cooperation between Texas and China.

Ladies and Gentlemen,

Today, this room is filled with business elites. You are friends of China. I hope you continue to grow your business with China, continue to support cooperation with China, and continue to participate in China’s development and reform. I’m confident that your involvement and support will enrich China-US cooperation and advance our friendship.

Thank you.

 

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