"Peaceful Development Is The Fundamental State Policy Of China"

Saturday, December 1, 2007 - 01:00

The Editor interviews the Hon. Zhou Wenzhong, Ambassador of the People's Republic of China to the United States.

Editor: Ambassador Zhou, would you tell our readers something about your responsibilities as China's Ambassador to the United States?

Zhou: It is a distinguished honor for me to serve as Chinese Ambassador to the United States. I can feel the trust of my country and people and the tremendous responsibility on my shoulders. Since I took the office two years ago, I have worked hard, together with my colleagues from the Embassy, to promote friendly exchanges and understanding between the peoples of China and the United States.

We are here to take care of China-U.S. bilateral relations - including economic, political, cultural, military, and educational relations - and this presents us with both opportunities and challenges. Our countries share many common interests, and these constitute the mainstream of our ongoing relations. There are, of course, challenges. One of the biggest challenges, from our perspective, is the perception of China in the U.S.

We believe that China is a force for peace in the world. To that end, we seek good relations with all countries regardless of ideology or social systems. Among at least some people in the U.S., however, there is the perception that China is a rival, if not now then at some point in the future. It is my principal responsibility to help people get to know my country better and, through such an exercise, to understand how important it is for us to work together.

Again, China and the United States are the world's biggest developing country and the biggest developed country, respectively. Both are big countries with significant global influence. We share extensive and important common interests and have differences at the same time. It is therefore an arduous task for our two countries to better serve their peoples by constantly expanding their common interests, enhancing mutual trust and appropriately handling their differences. To my gratification, China-U.S. relations have maintained a momentum of overall stability and development thanks to the care and direct efforts of our leaders and the joint efforts of people from all walks of life.

Editor: You serve as your country's principal spokesman in the U.S. What is the essential message that you are trying to convey to the U.S. government?

Zhou: The central message is that China's development is peaceful. Peaceful development is the fundamental state policy of China. There are people who believe that history teaches that the rise of a country inevitably leads to conflict with other countries. Our message is that this is not necessarily so.

As the world becomes increasingly interdependent, we believe what is essential in China-U.S. relations is to build on our common interests. China cannot develop without the world; and the world cannot enjoy peace and prosperity without China. Truly we live in a global village. The challenges we face are those that everyone faces - climate change, epidemics, drug trafficking, terrorism, and so on - and if we are to overcome them we must work together.

Furthermore, according to the important understanding between President Hu Jintao and President George W. Bush, China and the United States are both stakeholders and constructive partners. Bearing in mind that the good situation in China-U.S. relations has not come easily, it deserves to be cherished. China is ready to join hands with the United States to always work in the spirit of mutual respect, equality, mutual benefit and win-win cooperation, following the principles set forth in the three Sino-U.S. joint communiqus, enhance dialogues, expand consensus, deepen cooperation and handle their differences appropriately so as to further advance the constructive and cooperative bilateral relationship.

Editor: You recently attended the recent 17th National Congress of the Communist Party of China in Beijing. What are the implications of the strategic decisions taken by the conference, for China and for the world ?

Zhou: The 17th Party Congress is a very important event at a crucial stage of China's reform and development. It mapped out a blueprint for China's development in the future. The policies and guidelines determined by the 17th Congress offer new opportunities and driving force for China to expand its mutually beneficial and win-win relationship with the rest of the world, including the United States, and open up new spaces for China to engage the world in the promotion of peace, stability and development.

The scientific outlook for development has been written into the Constitution of the Party, and this is a crucial aspect of China's development. By scientific outlook for development we mean that development should be carried out in a balanced and sustainable way. We also mean that people should be considered as our number one priority in development, that people come first. We believe that development offers us an opportunity to successfully address our problems, and while rapid development is important, the quality of growth - including the human factor - is even more important.

In the report delivered by the Party's General Secretary Hu Jintao, who is also President of China, a separate chapter is devoted to the issue of people's livelihood. This chapter spells out a variety of measures designed to improve conditions in the workplace and the ability of our people to make a living.

A third initiative has to do with the development of socialist democracy and the legal system. China believes in the rule of law.

The key message here is that China will develop in a peaceful way. China will unswervingly pursue peaceful development, follow a win-win, opening-up strategy, seek friendship and cooperation with all other countries on the basis of the Five Principles of Peaceful Coexistence and strive to build a harmonious world of lasting peace and common prosperity.

In a word, China cannot achieve development in isolation, nor can the world enjoy prosperity and stability without China. China is always a staunch force for peace. China's development is an opportunity for the world. We have every reason to believe in a better future for both China and the world.

Editor: China's economy is one of the most important in the world, but China is also a developing country. Please give us your thoughts about China as a bridge between the developed countries and those that are still developing.

Zhou: China is a developing country. In per capita terms it ranks something like 110 of all the world's countries. In addition, China's development has been uneven, and there is a large gap between the coastal provinces and those of the interior. And, of course, all over the country there are many people living below what the UN considers the subsistence line. At the same time, China is a Permanent Member of the UN Security Council. That imposes certain responsibilities on us, and we are very mindful of the ways in which we can contribute to the developing countries. We certainly understand their aspirations because they are our own.

As to be a bridge between the developed countries and the developing countries, I think China has a positive role to play in the following aspects, as China, as the most open developing economy, enjoys close economic and trade ties with the developed countries.

First of all, China is in a stage of rapid economic growth. There are achievements as well as challenges. Our experience provides useful reference to other developing countries, including the success of our economic restructuring and active participation in the globalization process, especially our effective practice in poverty reduction, as well as the lesson we have learnt.

Second, China is ready to share the development opportunities with all the other countries. The industrial structural readjustment that is going on in China not only offers new market opportunities but also helps bridge the global development gap as low-end industries move to other developing countries through overseas investment and help boost the development capabilities, increase employment and improve lives in these countries.

Third, China will continue to play a role in international organizations. While continuing to safeguard the legitimate rights and interests of the developing countries, China will work on enhancing dialogue and negotiations between the developing and developed countries, reducing conflicts and frictions, building a fair, mutually beneficial and win-win world economic order, and promoting common development.

Editor: Technology is something of great importance to China and, indeed, to all of the developing countries. Does China have a role to play in helping other developing countries cross the technological divide that separates them from the developed countries?

Zhou: We are doing what we can in helping the developing countries with respect to technology transfer. That includes undertaking a variety of projects, providing lines of credit, funding, scientific and technological expertise, and so on. I think the issue of technological development is a very serious one - the gap between the haves and the have-nots is widening - and I hope that the developed countries will see their way clear to addressing it. If they do not, I see some very dangerous consequences - including terrorism - ensuing.

So we believe that at least the following should be done to narrow the technology divide between the developing and developed countries.

First, countries should decide on the models for technological and economic developments for themselves independently and according to their national reality. This is the key to achieving development.

Second, efforts should be made to further improve the international environment for cooperation on technological development and formulate fair and just international rules that reflect the concerns of the developing countries so that economic globalization will be balanced, win-win and beneficial to everyone.

Third, international technological cooperation should be strongly advocated. The developed countries should assume the responsibility and earnestly fulfill their obligations. They should increase development aid, transfer technology and enhance international technological cooperation. At the same time, there should be continued encouragement to the developing countries to carry out South-South cooperation.

Editor: Please tell us about China as an investment destination and place to do business. Does the country continue to welcome Japanese and Western enterprises?

Zhou: Since the beginning of reforms and opening-up three decades ago, the Chinese government has been exerting all its efforts to create a liberal and open investment environment for overseas businesses featuring fair competition. Joining the WTO gave a further boost to such efforts. Foreign investment laws and regulations have been constantly improved and the consistency of the policies on attracting foreign investment has been maintained. We have increased protection of intellectual property rights, dealt with various forms of violation severely, enhanced the enforcement of laws and administrative regulations and protected the lawful rights and interests of overseas funded enterprises. Particularly, in recent years, we have seen more and more multinational companies setting up global production bases, R&D facilities and regional headquarters in China. This demonstrates an increasing confidence of the overseas businesses in investing and doing business in China.

The just concluded 17th Party Congress reaffirmed that China will expand opening up in scope and depth, and increase the level of economic openness. The United States, the EU and Japan are our important partners in opening-up efforts and external economic cooperation and trade. We welcome their continued investments and business in China, and hope to work together with them to create a win-win situation.

Now, some more remarks about what kinds of investment China seeks from abroad.

Through unceasing improvement of its investment environment for three decades, China has attracted a total of U.S.$700 billion in foreign investment. Multinational companies have provided China with funds, technology, management expertise and market resources that are much needed in China's modernization. They are also rewarded with huge profits.

As China continues to develop, there is rising need to adjust the economic structure and transform the mode of growth. Thus more attention is given to the quality and structure in utilizing foreign investment. According to the requirements of the 17th Party Congress, China will make innovations in the way of using foreign capital, improve the structure of foreign investment utilization, and let the use of foreign capital play a positive role in facilitating independent innovation, industrial upgrading and balanced development among regions.

To be specific, we will encourage foreign investors to focus more on high-tech and advanced manufacturing industries, modern agriculture and service sector, and multinationals to establish R&D, purchasing, operation, logistic and training centers in China. Geographically, we encourage foreign investment in China's inland areas away from the coastal regions.

China does not welcome highly polluting and energy intensive industries or processing industries that are low value added and prone to trade frictions. To put it simply, we welcome foreign investment that will help China achieve sustainable development.

Editor: China is beginning to send its own enterprises abroad. Please give us your thoughts on how this process is evolving. Are we going to see multinational corporations with a Chinese origin?

Zhou: For the purpose of adapting itself to economic globalization and achieving sustainable economic and social development, China has adopted a national development strategy of "going global." The Chinese government encourages domestic enterprises to invest abroad, carry out transnational operation and participate in all forms of international economic and technological cooperation and competition according to their own needs and capabilities. This, we believe, will give these enterprises access to both domestic and overseas markets, opportunities to optimize their resource allocation and room for further development. It is also a win-win strategy that is good for China's national economic development and its cooperation with the rest of the world.

At present, direct investment (such as building factories and joint exploration of resources), project contract and labor contract are the main forms of the overseas business of Chinese enterprises.

The United States is a major destination for the Chinese enterprises in exploring and expanding their overseas business. By June 2007, Chinese direct investment in the United States, mainly in trade, transportation, R&D and processing, totaled nearly U.S.$3 billion. Such investment has demonstrated a trend of rapid acceleration in recent years. Not only big name players, such as COSCO, PetroChina, China Construction Group, China Telecom, China Ocean Shipping and Haier Group, are riding the wave. There are many local SMEs from China as well. Chinese investments in the United States have provided thousands of jobs, helping the host communities reduce the employment pressure and promote economic and social progress.

China will make innovations in our way of overseas investment and cooperation, support domestic enterprises in carrying out international operations in R&D, production and marketing, and accelerate the growth of Chinese multinational corporations and brand names in the world market. Meanwhile, China is a developing country and Chinese enterprises lack experience in overseas investment. We hope that Chinese and American companies will strengthen cooperation, pool their respective strong points and make new progress in exploring international business opportunities.

Editor: Over the past 20 years China has sent large numbers of students abroad, to Europe and North America principally. This is a major investment in China's future. What are the areas in which the Chinese government is interested?

Zhou: Sending students overseas in large numbers is an important component of China's reform and opening-up policy. It is the government's policy that education should open up to the outside world. We endorse overseas study, encourage the students to return after they complete their studies abroad and ensure their free movement in and out of the country.

Between 1978 and 2006, China sent roughly 1.06 million students to over 100 countries, 36 percent to North America, mainly the United States, 28 percent to Europe, and 260,000 students returned to work in China. The overseas students have contributed greatly to the all-round development in China as well as exchanges and cooperation between China and the outside world.

There are two main categories of Chinese overseas students according the source of funding, namely public and private. Publicly-sponsored overseas study is funded by the government and focuses on leading talents in various fields. The program funded 10,000 people this year. According to the National Mid-to-Long Term Science and Technology Development Program 2006-2020, and in line with the economic and social development need, the public sponsorship program mainly focus on such disciplines as energy, resources, environment, agriculture, manufacture, IT, life science, space science, marine science, nano and new material, humanity and applied social sciences.

Overseas study funded by private resources of Chinese citizens is also an important means of higher education. Of the 140,000 overseas Chinese students in 2006, about 130,000 were privately funded. The Chinese government supports privately funded overseas study and provides the students on private fund with the same service as provided to those on public fund. They are also encouraged to return after they complete their studies and help with China's modernization.

Editor: As globalization proceeds, are there ways in which it can be better managed?

Zhou: Globalization cannot be halted at this point. I do think, however, that it should be regulated in such a way as to make its benefits available in a fairer and more equitable way. The UN and a variety of international financial organizations - the WTO comes to mind - can make an enormous contribution to this discussion. We are not quite ready to implement anything concrete in this area, however.

Economic globalization has enhanced the global circulation and allocation of the factors of production, improved the overall level of productivity throughout the world, and provided new opportunities and favorable conditions for development to all countries. At the same time, the process is strewn with conflicts and risks in the form of exacerbated global economic imbalance, increasing economic and financial risk, greater pressure on energy and resource, growing trade protectionist tendency and marginalization of some developing countries.

China believes that countries in the world must take the challenges of economic globalization more seriously, strengthen consultation and cooperation, combine their strong points and work together to advance economic globalization in the direction of balanced development, shared benefits and win-win progress. The developed countries should make greater efforts to speed up the adjustment of their domestic policies and structures so as to increase aid to developing countries, waive or exempt their debts, open up markets and transfer technology. The developing countries should formulate development strategies and policies that suit their national conditions, strive to develop their economies and uphold their national interests.

China will seize the opportunities brought about by globalization to develop itself, and work hard to meet the challenges. We will continue to promote regional and international development through our own growth, expand the interests that we share with various parties and accommodate the justified concerns of others, the developing countries in particular, while pursuing our own development.

We will continue to follow the recognized international economic and trade rules, increase market access and ensure protection for the lawful rights and interests of our cooperation partners. We support international efforts in helping the developing countries to build up their capacity for independence development and improve lives so as to narrow the North-South gap.

We also support international efforts to improve global trade and the financial system, promote trade and investment liberalization and facilitation, and handle frictions appropriately through consultation and coordinated efforts. China will never do anything to harm other people's interest, or seek benefit at the expense of others. China is willing to make concerted efforts with all the countries in the world to ensure that economic globalization will be a balanced and sound process.

Editor: Would you share with us your thoughts about the opportunities and challenges in China-U.S. relations and their implications for the evolution of the world situation.

Zhou: That is an extremely important question. Today, the world is in the process of major changes and adjustment. The international situation is undergoing profound and complicated changes. The international community is faced with increasing challenges, and it is a compelling trend for countries in the world to strengthen consultation and cooperation.

Against this backdrop, China and the United States are presented with important opportunities to develop their relationship, which is taking on an increasingly global and strategic significance. As permanent members of the United Nations Security Council, both China and the United States shoulder major responsibilities for upholding world peace and stability. We have more common interests and greater need for cooperation in safeguarding regional and international security. Against the big picture of globalization, China-U.S. economic and trade cooperation not only delivers real benefit to the peoples of the two countries, but also becomes indispensable if the world is to achieve sustained economic growth and prosperity. In recent years, global issues such as climate change, spread of diseases and trans-national crime have posed grave challenges. Their solution requires consultation and cooperation among the international community including China and the United States.

There are also issues in China-U.S. relationship that require appropriate approach. The Taiwan question is crucial to China's sovereignty and territorial integrity and therefore at the very core of China's national interests. The secessionist activities of the Chen Shui-bian authorities in Taiwan pose the biggest and real threat to the peace and stability in the Taiwan Straits region and the entire Asia-Pacific. China hopes the U.S. side will honor its commitment of adhering to the one China policy, abiding by the three Sino-U.S. joint communiqus and opposing "Taiwan independence", send no wrong signals to the secessionist forces for "Taiwan independence", and work to safeguard the peace and stability in the Taiwan Straits and the shared interests of our two countries.

As for trade frictions, they are only natural phenomena of the rapidly growing economic and trade ties between China and the United States. China has always called for conducting bilateral consultation on an equal footing, accommodating each other's concerns and settling differences appropriately through dialogue and negotiations. Having different national conditions, China and the United States do not see eye to eye on some issues relating to human rights and religion. The right approach to these differences should be dialogue on the basis of equality and mutual respect so as to enhance mutual understanding, reduce differences and seek common ground.

And, of course, as I mentioned at the very beginning of our conversation, there's the issue of a perception of China as a threat held by at least some people in the U.S., which is one of the greatest challenge we face in China-U.S relations. We wish to be perceived as a friend and partner of the U.S.

It is my belief that, in the future, the shared interests between China and the United States will continue to grow, and the area of cooperation will continue to expand. The China-U.S. relationship will be even more important. Its sound and steady development is surely a blessing for both countries as well as the people of the world.

Editor: Is there anything you would like to add?

Zhou: I appreciate the vigorous efforts of The Metropolitan Corporate Counsel in recent years to report on China, especially through its annual end-of-year China feature which opens a window for its readers on China's economic and social development and the progress of China-U.S. relations and mutually beneficial cooperation.

I hope that, as an influential professional publication, you will continue the active and objective reports on China so that more people from both countries, especially the professionals, will come to see the benefits of a growing China-U.S. relationship, enhance mutual understanding and engage in friendly and mutually beneficial cooperation. I wish you success.