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Speech by Ambassador Yang Yanyi, Head of the Chinese Mission to the EU at the Opening Session of the Workshop on China, the Digital Economy and the EU Investment Plan

June 4th 2015

Honorable President Markkula,

Honorable Members of the Committee of the Regions,

Distinguished Representatives from the EU institutions,

Distinguished Chinese and European Participants,

Ladies and Gentlemen,

At the outset, I would like to congratulate the Committee of the Regions, ChinaEu and the Chinese Mission to the EU for co-hosting today’s Workshop on China, the Digital Economy and the EU Investment Plan.

I commend President Markkula and COR’s continuous effort to promoting understanding and cooperation between European and Chinese local communities and peoples.

I would also like to thank President Luigi Gambardella and ChinaEU for their instrumental role in advancing cooperation, trade and investments in digital products and services by linking together the major European and Chinese Internet players, telecom operators and high tech companies with Chinese and EU officials and regulators.

I am sure our distinguished audience in the room is fully aware that China is now shifting its economy away from manufacture driven export model to an innovation oriented one. It is hoped that in the years to come innovation and digital economy will be the main engines of growth in China.

Recently in China’s Silicon Valley -- the Zhongguancun Haidian Science and Technology Park in Beijing a street called Inno Way has been formally launched.

This Inno Way is just some 10-minutes walk from where I live. Personally I have witnessed with my own eyes how a street filled with tea houses, hairdressers, restaurants, groceries and book stores being transformed into an innovation hub filled with innovation startups and service institutions and aspiring to become a global center of technological innovation by 2020.

In one of the offices of innovation startups on this Inno Way, there is a printed catch-phrase: "Life is limited, but zheteng (折腾) is not." Zheteng (折腾) is a Chinese term meaning to toil and bustle around something that seems impossible and futile. When Premier Li Keqiang saw this catch-phrase during his recent visit to the Inno Way, he said:“That really sums up innovation.”

The Inno Way is just one example that speaks volume of China’s great intellectual legacy, passion and pursuit of exploration, creation and innovation. Since more than 2000 years ago, our great ancestors taught us, as heaven maintains vigor through movement, a gentleman should constantly strive for self perfection.

Over the past 30 years, guided by the strategy of “rejuvenating the nation by relying on science and education”, China has made striking achievements in science and technological innovation with atomic energy, space, high-energy physics, biology, supercomputer, information technologies reaching or approaching international advanced levels. Home-grown companies such as Xiaomi, Alibaba, Lenovo, Coolpad, Huawei and ZTE have become household names and globally celebrated brands.

Presently, steady progress has been made in the development of new types of industrialization, applications of information technologies, urbanization, agricultural modernization and green growth. With the foundation underpinning development becoming stronger, China’s development enjoys enormous potential and remains hugely resilient.

While recognizing our achievements, we are mindful of the difficulties and challenges ahead.

The world economy is undergoing profound adjustment, its recovery lacks drive and there are a many uncertainties and destabilizing factors at play. Our economic growth model remains inefficient and our capacity for innovation insufficient, we are faced with an array of overlapping and deep-seated institutional and structural problems.

In order to defuse risks and come to grips with challenges and avoid falling into the “middle-income trap” and to achieve the dual objective of maintaining a medium-high-level growth rate and moving toward a medium-high-level of development, China is now focusing on structural adjustment through structural reform, making good use of the “golden key” of innovation, and moving vigorously forward in industrial structural upgrading.

We are implementing an innovation-driven development strategy, the “Made in China 2025” strategy, seeking innovation-driven development, applying smart technologies and pursuing green growth.

We are promoting extensive application of information technologies in industrialization, developing and utilizing networking, digitalization and smart technologies.

We are launching major projects to develop high-end equipment, information networks, integrated circuits, new energy, new materials, biomedicines, aero engines, and gas turbines, keeping in mind that emerging industries and new types of businesses are areas of intense competition.

We are developing the “Internet Plus” action plan to integrate the mobile Internet, cloud computing, big data, and the Internet of Things with modern manufacturing, and we are encouraging the healthy development of e-commerce, industrial networks, and Internet banking.

We are creating enabling environment for creativity and pushing forth institutional innovation to remove all obstacles to development and unleash the full potential of innovation and creation of the 800 or 900 million laborers and medium, small and micro businesses among the 1.3 billion populations.

We are speeding up reform to manage the use and commoditization of scientific and technological advances and distribution of their profit, formulating policies to support basic research, research in cutting-edge technologies and key technologies, encourage the flow of researchers and engineers, and implementing in earnest the national strategy on intellectual property rights, cracking down on infringements and ensuring inventions and creative works are protected.

And we are promoting a new type of people-centered and environmentally friendly urbanization, which in itself the biggest structural readjustment.

China’s urbanization over the last three decades and more has been unprecedented in scale and has supported China’s rapid economic growth and development progress. China’s urban population has increased from 460 million in 2000 to 750 million in 2014, growing from 36.2% to 54.8%. Every year over 20 million Chinese move into cities, with some 1.8 million a month, the equivalent of the cities of Hamburg or Vienna.

With a view of fully leveraging the role of urbanization in underpinning modernization we are advancing in a vigorous manner a people-centered urbanization that is efficient, inclusive and sustainable.

Apart from such reforms relating to household registration system, improving the planning and construction of cities and towns, we are speeding up the development of schemes such as “broadband China” and “smart cities” to galvanize hinterland development, promote urban-rural integration and gradient development of different regions, and bring about a synchronized progress of the new type of industrialization, IT application, urbanization, agricultural modernization and green development.

The key strengths of China’s remarkable achievements lie not only in its industriousness, entrepreneurship and persistency in reform but also inclusiveness and persistency in opening up.

Guided by its conventional wisdom and philosophy of appreciating the beauty of other’s and drawing on each other’s strength for common good, shared prosperity and win-win, China has championed the global flow of knowledge, technology and talents, forged cooperative relationships in science and technology with more than 150 countries and regions, and taken part in major global projects including the International Thermonuclear Fusion Experimental Reactor Plan, the Human Genome Project and the Galileo Project.

China-EU relationship is proof in point. As we celebrate this year the 40th anniversary of China-EU diplomatic relations, we are proud to say that China-EU relationship has been a track record of win-win progress.

Thanks to their adherence to mutual respect, understanding and cooperation, China and the EU have been able to transcend their differences and divergence and work on areas of common interest and expand their cooperation from trade to now cover a wide spectrum of political-security, economic and social-cultural fields. China-EU relationship has not only reached an unprecedented level of interdependence but also unprecedented level of maturity and mutual benefit.

Standing on the threshold of a new decade, China-EU relationship is poised to gain further strengths and scale new heights of excellence.

China is embracing a new normal and new socio-economic model that gives priority to new engines of growth, first and foremost ICT. The EU, under the leadership of its new team, is making a difference on the big economic and social challenges by realizing a European Digital Single Market as well as Economic and Monetary Union and Energy Union.

Obviously, our respective agenda complements and reinforces each other. China’s pursuit of innovation-driven development and its “One Belt One Road” or new Silk Road initiative and Juncker’s Investment Plan offer both sides a unique chance to strengthen strong synergy and tap the full potential of their partnership for win-win and create new products, new services, new sectors and new job opportunities.

Among others, collaboration, coordination, cooperation and connection in Internet, telecom and high tech sectors will promote the inflow of Chinese ICT investments in Europe, create new investment opportunities for European companies in China, unleash fresh initiatives that will bring benefits to both the European and Chinese markets, contribute to EU’s priorities of growth, jobs and competitiveness and strengthen their collective strategic presence in the future global ICT market.

It is very encouraging that there is a strong sense of urgency and growing enthusiasm to seize the window of opportunity to cement and upgrade China-EU high-tech and ICT cooperation and adapt to the sweeping digitization of the world economy.

At the top political level, our leaders share the same vision that China and the EU are the most important partners and that the two sides should deepen their all-dimensional practical cooperation including in the field of information, communications and technological innovations to ensure that their partnership take on even greater global strategic significance and bring more tangible benefits to their peoples, regions and world at large.

At the grassroots level, there is increasing interest in linking the Juncker Investment Plan with the One Belt One Road initiative and promoting practical and result-oriented programs, projects and activities that correspond to the new requirements and needs of both sides. Joining the AIIB by some member states of the EU is a significant step to deepen China-EU financial cooperation.

With a view to contributing to the creative and dynamic deliberations at this session, I wish to share with our distinguished delegates some of our thoughts and proposals with regard to advancing China-EU cooperation in the investment sector as well as in community communication and collaboration.

First, reaffirm at the forthcoming 17th China-EU Summit our commitment to jointly explore converging points between our respective development agenda, including the building of synergy between the “One Belt One Road” initiative with the Juncker Investment Plan.

Second, conduct exchanges and dialogue within the framework of the annual China-EU High Level Economic and Trade Dialogue on further implementation of the China-EU 2020 Strategic Agenda for Cooperation and other relevant strategies and policies, the conclusion of the China-EU Comprehensive Investment Agreement, as well as the digital economy, innovation, finance, and regional development.

Third, raise the awareness of the significance, relevance and complimentarity of the major work programs such as the One Belt One Road initiative, the Juncker Investment Plan, and help Europeans to have a clear understanding of the concrete opportunities and the challenges of China’s digital market so as to garner support, confidence and participation of the public and private sectors and other stakeholders and leverage the technological and innovative strengths and resourcefulness of our societies and markets.

Fourth, focus on innovative projects relating to 5G, 5G standards, high-tech innovation, Internet, e-commerce, advanced digital services, cyber security, big data and smart cities and smart energy.

Fifth, forge strong synergies between our respective programs by identifying and locating specific mutually beneficial cooperative projects and startups.

Sixth, encourage public and private investment of EU and non-EU countries including potential Chinese investors in mutually agreed projects or joint ventures.

Seventh, create favorable and enabling environment to ensure smooth and valuable collaboration between Chinese and European business and entrepreneurs and remain vigilant against protectionism. In this connection, it is highly necessary to conduct China-EU legal affairs dialogue to enhance communication and collaboration on rule of law, harmonization and streamline of regulations, IPR protection and other relevant policies and remove barriers and obstacles to free up the huge potentials for cooperation.

Eight, reinforce cooperation on science, technology and innovation by enhancing contact and cooperation between related businesses, entrepreneurs, think-tanks, academics, institutions and universities to tackle common challenges.

Last but not least, expand China-EU urbanization cooperation.

Regional communities are the driving force and key players in turning our vision into reality. Cooperation between regions within and without our respective land through urbanization partnership enables better management of cross-cutting issues and down-to-earth, flexible and quicker implementation of result-oriented cooperation, including cooperation on innovation, ICT and investment.

With regard to our objectives, we will strive to combine the strengths and advantages of the EU’s high-tech with China’s huge market to maximize the benefits of cooperation.

We will promote with European cities and regions managerial experience in sustainable urban development planning, management and urban-rural integration.

We will work together with European cities and regions to improve infrastructure relating to urban development such as energy, transportation, telecommunication, environment, housing, industrial layout, public services, application of green technology and protection of the ecological environment.

We will vigorously promote cooperation on smart city, low-carbon city, eco-city and smart energy programs, focusing particularly on ICT, 5G and green and low-carbon development.

We will build demonstration cities and promote cooperation between cities, and between cities and industrial parks and enterprises to share experience and good practices pertaining to good administration, urban mobility, eco-buildings, and disaster prevention and control.

We will also work together with the EU regions to promote mutual investment, including co-financing under the Juncker Investment Plan. In this regard, identification and selection of good projects and startups is crucial.

With regard to the structure of our cooperation, we will give full play to the role of the China-EU Steering Committee and the China-EU Innovation Cooperation Dialogue to guide the course of our cooperation and present deliverables to the China-EU Summit.

We will keep up the momentum of the China-EU Urbanization Partnership Forum, the China-EU City Expo and the China-EU Mayors’ Forum, and work closely with the EU side to make sure the upcoming China-EU Urbanization Partnership Forum be crowned with success.

And we will not only work with our EU partners at the central level and city level but also at the non-governmental level as well as between cities and business and financial institutions. To keep abreast with changing situation, it is highly necessary that platforms or clubs be set up between Chinese and European businesses and companies to work in concert to deliver change.

Last but not least, we will strengthen communication and coordination with COR and ChinaEU. Your efforts to promote and enrich cooperation between local and regional authorities, major European and Chinese Internet players, telecom operators and high tech companies in the Member States and beyond are invaluable. We look upon you for continuous support and assistance in our joint effort to bring more tangible result of our cooperation for the benefit of all.

In conclusion, it is of our collective interest and shared aspiration that throughout the discussions of this workshop, positive and practical contribution will be made towards the success of our cooperative efforts. I am sure you are able to turn words into actions. I wish the workshop full success.

Thank you very much.

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