25 September 2018, Sofitel
President Mats Harborn,
Ladies and Gentlemen,
It is a great pleasure to speak to at the first EU-China Forum 2018. Many of you are doing business in China. You are reading, writing and benefiting from the story of China-EU economic and trade cooperation. You are in a better position than anyone else to tell this story. I had a useful discussion with Mr. President and his team yesterday, and I am interested to hear from more of you today.
Before that, let me share some thoughts.
Nowadays, in any conversation about trade, China and the United States must be the most mentioned words. Indeed, industrial and value chains are so globalized that any trade conflict will definitely spill over to other parties. Yesterday, the 10 percent tariffs on 200 billion US dollars of Chinese imports took effect. Up to 50% of the affected companies are estimated to be foreign-owned companies in China, which, no doubt, include a big number of EU companies. With that, to get things right, it is imperative for China and the EU to step up coordination and join hands to address the challenges.
To support multilateralism and the rules-based free trade order is a commitment shared by China and the EU, and is in our shared interests. Without a stable and predictable global trade order, China-EU relations would not have achieved so much as today. However, this very order is being challenged by unilateralism and protectionism. “Unpredictable” seems to have become the most predictable thing. Given the sheer size of the EU and China, our collaboration will make a big difference. Together, we could inject more certainty into global economy and save it from further disruptions.
Like the EU, China also calls for continued reform and improvement of the multilateral trading system, in order to make global economic governance more relevant. China and the EU have already established a working group on WTO reform, which is now running well. I have noticed the concept paper on WTO modernization published by the EU last week. I am not a WTO expert and could not comment on the specifics. But there is one thing that remains true. Any practical step on WTO reform must be the one that takes care of the requests and concerns of the vast majority of its membership and that preserves such fundamental values as free trade.
Ladies and Gentlemen,
With so many things going on, many are asking if there will be a change of direction in China’s reform and opening-up. My President, Mr. Xi Jinping, gave a clear answer at the Boao Forum last April. He said, “opening-up was key to China’s development over the past 40 years, and in the same vein, high-quality development of China’s economy in the future can only be achieved with greater openness.” Last week at the Summer Davos Forum, Premier Li Keqiang reiterated that China will work even harder to advance reform and opening-up, and create a market environment in which companies of all ownerships, be they Chinese or foreign-owned, are treated as equals and compete on a level playing field.
I am carefully reading this year’s European Business in China Position Paper. I have just finished the Executive part and yet to finish all the 33 sub-papers. It is encouraging to note that China’s willingness to continue to open up and reform was recognized. Yet I’ve also got an idea of the concerns of European companies. I know you are eager to see a faster pace and better implementation and enforcement. Frankly speaking, such feelings are shared by China’s top leadership. Last week, President Xi said that for reform to press ahead, to get things done is as important as it is difficult. More energy and efforts must be devoted to implementation.
This year, China has adopted new measures to expand market access, improve business environment, better protect IPRs and boost imports, as pointed out in the Position Paper. These measures have already or are being turned into real actions. We will definitely do more.
Business friends like you must know that implementation is a complicated thing, because many factors are at play, and many difficulties have to be got over. The Position paper pointed out that many of the problems are “not necessarily an expression of state policy, but instead result from poor regulations designed by lower-level officials that are inconsistently enforced”. In this connection, you are always welcome to bring to us problems like this once you encounter them. As Ambassador, I would do my best to bring them to the attention of my capital, including the 14 most common concerns reflected in the Position Paper.
Many of you work and live in China for years. You know what China is like. It is big. Its development is not balanced across regions. Its economic transformation is so complex and difficult that naturally, there could be a tussle of opinions and interests. Yet no matter how things may evolve, China remains committed to further reform and opening up. This is a set direction that would not change. Please rest assured and have more trust and patience in China.
Actually, most of you have been personally engaged in and have benefited from China’s reform and opening-up. Your comments, suggestions and expertise have and will continue to be helpful. For us, well-intentioned recommendations or even criticisms could be a motivation for progress. But exaggerating and inflammatory rhetoric as often seen in some media could not help solve problems at all. We hope that people with good sense, like you, could continue to see China and its development in an objective and constructive way.
Ladies and Gentlemen,
To bring cooperation forward, governments have the duty to forge better policies. More importantly, it is up to business communities to explore new and tangible opportunities of cooperation. The Belt and Road Initiative (BRI) could contribute. It provides an open platform which allows countries to seek cooperation for mutual benefit, especially that in the area of connectivity. European companies see the initiative positively. Good progress is being made in cooperation.
Last week, the EU adopted its strategy on connecting Europe and Asia. The strategy advocates comprehensive, sustainable and international rules-based connectivity, and calls for cooperation with Asian partners, like China. The strategy has a lot in common with the BRI, and Chinese and European leaders agreed to forge synergy between their initiatives. For sure, that will generate great opportunities for Chinese and European companies.
Innovation and healthcare, the topics for today’s sessions, are promising areas of cooperation as well. The EU is China’s largest source of technology imports. Meanwhile, China is making great strides in some areas, let’s say, the Internet. China and the EU have strengths in different fields. As the fourth industrial revolution gathers momentum, China-EU innovation cooperation could produce a multiplying effect.
Regarding healthcare, there is a rapidly growing demand in China. We have launched the program of “Healthy China 2030”, which encourages diversified channels of medical service provision, and greater development of industries like fitness and pharmaceuticals. There will be greater needs for services tailored for the elderly, like health food and health equipment.
Ladies and Gentlemen,
I hope you leave here with three simple messages today. First, China will continue to open up and reform despite the global challenges. Second, the problems that you have brought up will be taken seriously by the Chinese authorities. In fact, many problems will be resolved in the process of further reform and opening up. Third, cooperation could not go deep without mutual trust and mutual understanding, which require direct and sufficient communication. It is more so when it comes to China and the EU whose cultural backgrounds are so different. Business people like you, especially those with a good knowledge of China, could be a bridge between the two sides. I count on your continued support and contribution. Thank you.