— Keynote Speech by Premier Wen Jiabao at the Ninth Summit of the Asia-Europe Meeting

(Vientiane, November 5, 2012)

I would like to thank the Lao Government for its thoughtful arrangement of this summit. I remember the Seventh Summit of the Asia-Europe Meeting (ASEM) was held in Beijing in autumn 2008 at a time when the global financial crisis fully exploded and spread rapidly. Together with colleagues in Asian and European countries, we sent the world a message of solidarity to overcome difficulties, thereby strengthening the confidence and hope of the international community to overcome the crisis. Over the past four years, Asian and European countries have worked constantly to improve their domestic economic policies, address their own problems in a targeted manner, strengthen dialogue and coordination in macroeconomic policy and deepen pragmatic cooperation in all areas. These efforts have yielded positive results and helped maintain the momentum of the recovery of the global economy.

China is a large, responsible country that has always taken an active and responsible attitude toward the global financial crisis. We sought to manage our own affairs, and succeeded in stabilizing the Chinese economy in a short time and ensuring steady and relatively fast economic growth. While sticking to the principles of openness and cooperation, we have worked for the balanced development of import and export and coordination between introducing foreign capital and investing overseas. We have sent a total of 33 major procurement missions abroad, which created huge demand and employment opportunities for countries concerned as well as favorable opportunities for the development of transnational corporations. We have taken an active part in global economic governance, made our contribution to the reform of the international financial system, conducted bilateral dialogues and offered aid to countries in economic difficulty. During the past four years, the Chinese economy has experienced an average annual growth of over 9 percent; China's foreign trade volume has exceeded $11 trillion, of which imports amount to nearly $5.3 trillion; China has attracted more than $400 billion in foreign investment; and it has invested $250 billion abroad. During this period, we have conducted an in-depth reform of the renminbi exchange rate regime and worked to make the renminbi exchange rate more flexible. The real effective exchange rate of the renminbi rose 16 percent based on strong appreciation in previous years and China's current account surplus is now 2.6 percent of GDP, as opposed to 10.1 percent in 2007. These figures show that China is an important engine for global growth and has played a crucial role in the recovery of the global economy.

Since this year, faced with a complex international economic environment and serious external demand contraction, we have given more importance to maintaining stable growth and made the stimulation of domestic demand, especially consumer demand, a priority of our work. Our active efforts to restructure the national economy and strengthen and improve macroeconomic control have yielded remarkable results. During the first three quarters, China's GDP grew 7.7 percent; the consumer price index rose 2.8 percent compared to the same period of the previous year; 10.24 million jobs were created in urban areas; imports and exports volume grew 6.2 percent; and balance of payment accounts became more balanced. The Chinese economy is now characterized by stable growth. In September, leading economic indicators showed a general increase. The added value of major industries experienced a real increase of 9.2 percent compared to the same period last year, while the volume of retail sales grew 14.2 percent. Investment in fixed assets increased 20.5 percent in the first three quarters. Exports and freight traffic registered an increase of 9.9 percent and 11.8 percent respectively. The purchasing managers' index for the manufacturing sector rebounded for the first time in four months to 49.8 percent and the consumer confidence index rose to 100.8. As different policies and measures are implemented and produce effects, China's growth will be more stable. We are confident in our ability to achieve the development goals for this year, and we also have the confidence, conditions and ability to achieve a higher level of development with better quality for a longer term.

The international financial crisis is not over and there are still many uncertainties and downside risks. The international community is eager to hear wise voices, pool strength to overcome the crisis and find effective ways for an economic revival. With a large population, rich resources and a vast market, Asia is now the most dynamic region in the world. Europe, which has a strong real economy, a developed market system and scientific and technological prowess, remains an important center of the world. Currently, ASEM members represent 56 percent of the overall global economy and more than 60 percent of international trade. As we work in solidarity and cooperate closely, we will be able to assume the heavy responsibility to promote the stable growth of the world economy and to give the world confidence, courage and hope. In this regard, I would like to share some of my thoughts:

First, free, open and fair trade is an important driving force for global economic growth. Stable development of international trade can promote the social division of labor, expand the market and increase employment opportunities. It serves the common interest of all countries. We need to expand market access with more sincerity and determination, jointly fight trade and investment protectionism with even firmer attitudes and actions and deal with trade frictions with more reasonable means. We must stick to the commitments made at the Group of 20 Summit this year for not adopting new protectionist measures by 2014. We should upgrade the Trade Facilitation Action Plan and the Investment Promotion Action Plan as soon as possible, focusing primarily on cooperation in areas such as distribution, e-commerce, customs procedures, inspection and quarantine, infrastructure, access to investment and exchanges between businessmen to explore the immense potential of trade and economic cooperation. The Chinese side calls for the resumption of the ASEM Economic Ministers' Meeting in order to inject new vitality into economic cooperation between Asia and Europe.

Second, strengthening coordination of macroeconomic policies currently remains an important task. All countries should make strong, sustainable and balanced growth of the world economy a common goal, stick to the macroeconomic policies of sustaining growth and promoting employment, restore market confidence and promote healthy interaction between different economies. We must pay attention to the potential impact of new quantitative easing measures adopted by major developed economies. We should prevent large fluctuations in commodity prices in the international market, disorderly cross-border capital flows and mounting inflationary pressure on developing countries. We must continue to offer constructive support to European efforts to resolve the debt issue. European countries involved must manage the relationship between fiscal consolidation, financial stability and economic recovery. Major economies should quickly adopt clear and reliable mid-term fiscal consolidation plans to address public debt in a proper way.

Third, promotion of scientific and technological innovation is a fundamental means to overcome the crisis. Scientific and technological advances made after each major world economic crisis have always provided a new engine of growth to rebalance the global economy. The world today is on the eve of a scientific and technological revolution. Asian and European countries should strengthen their dialogue on technological innovation policies, deepen exchanges and cooperation in science and technology and take the pulse of the world's technological and industrial revolution. We need to give priority to cooperation in fields such as clean energy, environmental protection, space, biotechnology, information technology, telecommunications and sustainable development of cities. We also need to encourage companies to jointly create long-term and stable cooperation platforms such as joint research and development centers, technology transfer centers and joint incubators. We should integrate strong European capabilities in research and development with the vast potential of the Asian market to realize win-win outcomes. There is no border in technological innovation. We should eliminate technical barriers to trade and improve the system of intellectual property rights protection. Developed countries should provide more support to the development of emerging industries in developing countries, rather than contain or repress them.

Fourth, a healthy global economic governance system is an institutional guarantee for global economic growth. In recent years, the reform of global economic governance has yielded remarkable results, but the establishment of a just, equitable, inclusive and orderly international economic order remains an arduous task. To deepen the reform of the international financial system, it is urgent to implement the 2010 agreement on IMF quota and governance reforms to increase the representation and voice of emerging economies and developing countries, advance steadily the reform of the international monetary system, establish a stable, orderly and adjustable international reserve currency system, and effectively push forward the reform of the financial sector to reduce systemic risks in the financial system. We need to swiftly conclude the Doha Round negotiations with substantial results, put in place a free and open multilateral trade system and promote the establishment of a reasonable and transparent mechanism for setting and regulating prices of raw materials to ensure global energy and food security.

China is a member of the large ASEM family. It is an advocate of and contributor to Asia-Europe dialogue and cooperation. Over the last 16 years since the creation of ASEM, China has initiated and organized nearly 50 major events. The new director general of the Asia-Europe Foundation (ASEF) is a Chinese. The volume of trade between China and other members of ASEM represents nearly 50 percent of China's foreign trade and investment from other ASEM members accounts to about 20 percent of foreign investment used in China. In a bid to further deepen pragmatic Asia-Europe cooperation, we'd like to make following four new proposals:

First, we should hold a symposium to discuss the further development of ASEM in the new context.

Second, we should establish an Asia-Europe cooperation network for water resource technological innovation to intensify exchanges and cooperation in the management of water resources and serve the socioeconomic development of Asian and European countries.

Third, we should develop an Asia-Europe forestry demonstration project to promote cooperation in the sustainable management of forest resources and fight against climate change together.

Fourth, we should better promote the role of ASEF. China will increase its annual contribution to ASEF to $500,000 and hopes that all parties will be able to regularly and actively contribute to ASEF.

During all these years, I have been deeply committed to Asia-Europe cooperation. I have participated consecutively in five ASEM summits. I have witnessed the development of ASEM and found that Asia-Europe cooperation now has clearer objectives, a more solid basis and a more extensive scope. I'm filled with hope and confidence for a new Asia-Europe partnership and convinced that cooperation between the two continents will foster broader prospects.