Speech by Wen Jiabao, Premier of the State Council of
The People's Republic of China at the
China-ROK Business Luncheon
(Seoul, ROK, 11 April 2007)

Dear Mr. Sohn Kyung-shik, Chairman of the Korea Chamber of Commerce and Industry,
Dear Mr. Wan Jifei, Chairman of the China Council for the Promotion of International Trade,
Ladies and Gentlemen,

I am pleased to attend the China-ROK business luncheon. Let me take this opportunity to express my respect and appreciation to you, business representatives from both China and the ROK, for what you have done over the years to strengthen economic cooperation and trade between the two countries and enhance friendship between the two peoples. I also want to express my heartfelt thanks to you for your warm hospitality.

This is my first visit to the Republic of Korea, a beautiful and richly-endowed country. During my short visit, I am greatly impressed by the thriving development of the ROK and its hardworking and enterprising people. More importantly, I have keenly felt their goodwill towards the Chinese people. China and the ROK are neighbors with similar culture and a long history of friendly exchanges. Kim Gyo Gak, prince of Silla, studied Buddhist classics on Mount Jiuhua in China during the Tang Dynasty, and was later regarded as the reincarnation of Ksitigarbha Bodhisattva. Choi Chi Won, a writer of Silla, lived and worked in Yangzhou, China for a long time, and was known for his Gyewon Pilgyeong. Hur Kyun, a renowned novelist of the Choson Dynasty, wrote the following lines when bidding farewell to a Chinese friend of the Ming Dynasty, "Countries are different, but human nature is the same. All of us are brothers, why separate us by nation? We treat each other with full sincerity, which is witnessed by the moon." These examples fully reflect the profound friendship between the two peoples.

This year marks the 15th anniversary of the establishment of diplomatic relations and the Year of Exchange between China and the ROK. In the past 15 years, guided by the principle of mutual respect, equality, mutual trust, mutual benefit and win-win cooperation, we have boosted friendship in all fields and expanded economic cooperation and trade, delivering real benefit to the two peoples. Bilateral trade has grown 26 times to US$134.3 billion in 2006 from US$5 billion in 1992, making the two countries important trade partners of each other. Mutual investment is growing. The ROK had set up over 30,000 companies in China with a total actual investment of US$35 billion by the end of 2006. More Chinese companies are also investing in the ROK. People-to-people exchanges are flourishing. The number of ROK residents in China exceeded 500,000 in 2006, and more than five million mutual visits were made in the year. There are nearly 800 flights between the two countries every week. One out of three foreign students in China is from the ROK. On our part, 24,000 Chinese students are studying in the ROK.

Ladies and Gentlemen,

Business ties are a major component of our relations. To strengthen such ties is the shared desire of the two peoples. China and the ROK have unique favorable conditions and huge potential for building strong business ties including geographical proximity and convenient traffic links. With the ROK's strength in technology and managerial expertise and China's abundant labor resources and large market, the Chinese and ROK economies have much to offer each other. We need to expand the scale, broaden the scope and upgrade our trade ties. To accomplish this goal, I propose that we take the following steps:

First, expand trade. We should implement the Joint Research Report on the Mid- and Long-Term Vision for China-ROK Economic Cooperation and Trade, improve the mechanism of economic cooperation, trade and dialogue, foster a more enabling and efficient trading environment to meet the target of US$200 billion of annual trade at an early date. We should continue to improve trade mix and increase the trade of agricultural and hi-tech products and trade in services while maintaining the fast growth of trade of machinery and electronic products. The Chinese Government appreciates the efforts made by the ROK to reduce China's trade deficit. China is ready to open its market further to the ROK and increase import from it. We also hope that the ROK will further lower its import barriers to facilitate China's export to its market.

Second, promote mutual investment. We need to remove obstacles to mutual investment by our companies and foster an enabling investment environment. China hopes that the ROK companies will shift the focus of their investment in China from general manufacturing to agriculture, high-tech and service industries, and from processing and assembling to R&D and design in manufacturing. The Chinese Government welcomes the participation of ROK companies in infrastructure development and ecological improvement in western China, revitalization of the old industrial bases in northeast of China, and restructuring of China's state-owned enterprises. The Chinese Government also encourages strong and reputable Chinese companies to invest in the ROK and supports them in this effort.

Third, enhance scientific and technological cooperation. The ROK, in the process of industrialization, has developed advanced technologies with proprietary intellectual property rights through introduction, digestion, absorption and innovation. China hopes to draw on the ROK's advanced experience and strengthen technological exchanges and cooperation with it in environmental protection, energy conservation, communication, logistics, hi-tech and IPR protection in order for both countries to achieve sustainable economic development.

Fourth, promote China-ROK joint study on establishing a free trade area (FTA). To establish China-ROK FTA is important to the long-term growth of economic and trade ties between the two countries. China-ROK non-governmental joint study on FTA has been successfully concluded and government-industry-academia joint study on FTA has been launched and produced initial results. We hope that both sides will speed up work to produce a win-win proposal at an early date so as to pave the way for the early establishment of FTA.

Ladies and Gentlemen,

Cooperation and development require a peaceful and stable external environment. In today's Northeast Asia where our two countries are located, there are still destabilizing factors and regional cooperation needs to be enhanced. China and the ROK should make vigorous efforts to uphold peace and stability and advance common development in the region. The countries in the region should, on the basis of mutual understanding and mutual trust, find fair and reasonable solutions to issues left from the past, resolve disputes and address each other's concerns in a proper way, advance regional cooperation and strive to build a new and harmonious Northeast Asia.

Ladies and Gentlemen,

China is the largest developing country in the world, and it is committed to the path of peaceful development. This is not an expedient. Rather, it is a long-term and strategic foreign policy China follows. It is determined by China's reality of underdeveloped productive forces and weak economic foundation, and by its history, culture and traditions which value credibility, harmony and peace. It is also a solemn commitment China has made in keeping with the global trend. In pursuing peaceful development, we will, on the domestic front, continue to deepen reform and open wider to the outside world, focus on economic development, ensure all-round, coordinated and sustainable development and strive to build a harmonious society. Internationally, we will continue to pursue an independent foreign policy of peace and the opening-up strategy for mutually beneficial and win-win cooperation, and work with other countries to build a harmonious world of enduring peace and common prosperity. A more prosperous and open China will bring huge opportunities to the world and particularly to its neighbors and make greater contribution to peace both in our region and in the world.

Ladies and Gentlemen,

My brief visit to the ROK has covered a lot of ground and is highly productive. China-ROK cooperation has a bright future. This is what has impressed me most during this visit. I hope that the business communities of both countries will seize this good opportunity and work in partnership to write a new chapter of China-ROK economic cooperation and trade.

Thank you!