Address by H.E. Yang Jiechi

Minister of Foreign Affairs

At Luncheon Hosted by Canada China Business Council

Ottawa, 23 June 2009

Honorary Chairman Andre Desmarais,
Chairman Peter Kruyt,
President Peter Harder,
Former Prime Minister Right Honorable Joe Clark,
The Honorable Minister Flaherty,
The Honorable Minister Baird,
Ladies and Gentlemen,
Dear Friends,

I am delighted to join you at this luncheon. I want to thank the Canada China Business Council (CCBC) for its kind invitation and warm hospitality. It is a real pleasure to meet all of you, friends both old and new. For years, you have worked hard to enhance mutual understanding and friendship between our two peoples and promote bilateral relations between our two countries. Let me take this opportunity to express sincere thanks for what you have done.

I first visited Canada more than 30 years ago. That was shortly after I joined the foreign service and I came here as a staff member of a Chinese delegation. I was deeply impressed by your warm people, vast land mass and beautiful scenery. Later on, my work brought me here several times. Yet this is my first visit to Canada as the Chinese Foreign Minister and it is nice to be back again. The purpose of my visit is to continue our in-depth discussions on bilateral relations and other issues of mutual interest, increase understanding, build consensus, deepen cooperation, and push for continued improvement and growth of our bilateral ties. Yesterday, I had talks with Minister Cannon, and met with the Honorable Noël A. Kinsella, Speaker of the Senate. And this morning, I had separate meetings with the Right Honorable Prime Minister Stephen Harper and the Honorable Michael Ignatieff, Leader of the Liberal Party. The talks and meetings went very well, making my visit a very productive one.

Ladies and Gentlemen,

Dear Friends,

Relations between China and Canada have a long history. More than 100 years ago, Chinese workers came to Canada and made indelible contribution to the building of the Pacific Railway that extends from the east to the west of Canada. During World War II, people of our two countries fought side by side against the fascists. The heroic deeds of Dr. Norman Bethune are remembered by all the Chinese people. His internationalist spirit, his dedication to the service of others, has always been a source of inspiration to the peace-loving people of the world. In the early 1960s, Canada became the first Western country to conduct trade with China, exporting wheat to my country. That was a valuable support to the Chinese people. In 1970, the two countries established diplomatic relations and Canada became one of the first Western countries to establish diplomatic ties with the People's Republic of China, opening a new chapter in China-Canada relations.

In the past 39 years, in spite of some twists and turns, China-Canada relations have, on the whole, moved forward. Thanks to the personal commitment of leaders of several generations and concerted efforts of people from various sectors of both countries, our exchanges and cooperation in all fields have been growing steadily and exchanges at the top and other levels have increased. We have put in place over 40 exchange and cooperation mechanisms that cover a wide range of areas, including economy, trade, justice, law enforcement, energy, the environment, science, education, culture and health. Our two countries have conducted close cooperation at the United Nations, the WTO, G20, APEC and other multilateral mechanisms.

Our business ties have expanded from single commodity trade to diversified cooperation in all sectors. Our bilateral trade has grown from US$150 million in the early days of diplomatic relations to US$34.52 billion last year, reaching the target of bringing the bilateral trade to US$30 billion by 2010 set by our leaders two years ahead of schedule. China has become Canada's second largest trading partner, third largest export market and second largest source of imports. The high-quality yet inexpensive imports from China such as light industrial goods, textiles and a variety of consumer durables have enriched the daily lives of the Canadian people and saved them a lot of money. China's investment in Canada is also growing. Well-known Canadian companies such as Power Corporation, Bombardier and Alcan as well as financial institutions such as Sun Life, Manulife, Bank of Montreal and Royal Bank have established their presence in China and now enjoy booming business. The third phase of Qinshan Nuclear Power Plant is hailed as a model project of our cooperation in the peaceful use of nuclear energy.

Our people-to-people exchanges and contacts at the local level have been on the rise. China is now one of Canada's largest sources of immigrants and overseas students. There are a 1.4 million-strong Chinese community and nearly 60,000 Chinese students in Canada. The Chinese language has become the third largest language in Canada. We have established 44 pairs of sister provinces or cities. Each week, over 40 flights fly across the Pacific Ocean, linking Beijing and Shanghai with Vancouver and Toronto. Each day, more than 2,000 people travel between the two countries. Over 30 Canadian research centers across China have served as a window for the Chinese people to get to know Canada. In the same way, the five Confucius Institutes in Canada have enabled the Canadian people to study Chinese and learn about its culture. Here I wish to mention in particular the support of the Canadian government and people for the Chinese government and people in the wake of the massive earthquake in Wenchuan, Sichuan last year. Shortly after the earthquake, the federal and local governments of Canada announced several assistance measures and people from various sectors made generous donations. This fully reflects the humanitarian spirit of people of the two countries to support each other in the face of the devastating natural disaster and has greatly deepened the existing friendship between our two peoples. Let me take this opportunity to express, once again, our sincere thanks to the Canadian government and people.

A review of the growth of China-Canada relations shows that although our two countries differ in national conditions and do not always see eye to eye on everything, we should not let these differences stand in the way of our relations. And nor can they. As an old Chinese saying goes, harmony makes us close to each other and differences make us respect each other. Different civilizations and countries with different social systems should respect each other, seek common ground while shelving differences, draw on each other's strengths and pursue common development. It is important to respect world diversity, respect the right of people of all countries to choosing development paths of their own countries and not to interfere in other countries' internal affairs. As long as these principles are observed, China and Canada will keep to the right direction of their bilateral relations and promote sound and steady growth of the bilateral ties.

China-Canada relationship has not always been smooth in recent years. Yet, it is heartening to note, that with joint efforts, China-Canada relations are improving and growing. I want to mention in particular the important agreement on furthering China-Canada relations that President Hu Jintao and the Right Honorable Prime Minister Stephen Harper reached during their meeting at the G8 Outreach Session in Japan last July. It has given a strong boost to the exchanges and cooperation between the two countries in all areas. Since that meeting, new progress has been made in our mutually beneficial cooperation in a host of areas, spanning economy, trade, energy, science and technology, health and education. Today, our bilateral relationship is showing fresh vitality and broader prospects.

Ladies and Gentlemen,

Dear Friends,

We live in a world that is undergoing major transformation and adjustment. The world is moving toward multi-polarity and economic globalization is gaining momentum. Countries are more interdependent with their interests closely interwoven than at any time in history. The pursuit of peace, development and cooperation has become an irresistible trend of the times. However, the road to peace and development is still fraught with difficulties, as evidenced by unceasing local conflicts and hotspot issues, widening gap between the North and the South and simultaneous presence of traditional and non-traditional security threats. What merits our special attention is that impact of the global financial crisis on the real economy has become more visible and the world economic and financial situation remains grave. No country can meet these challenges alone and our only choice is to confront them through cooperation.

The world has gone through major changes and we should view the world and China-Canada relations from a new perspective. China and Canada are respectively the largest developing country and largest developed country in terms of territory. There is no conflict of fundamental interests between us. Rather, we share broad common interests and a good foundation of cooperation. Under the current circumstances, there is more reason for our two countries to enhance cooperation and work together to promote early recovery of the world economy and effectively meet all global challenges with a view to bringing greater benefits to people of the two countries and the world.

- To advance China-Canada relations, we should maintain exchanges at the top and other levels and increase mutual political trust. High level exchanges play an irreplaceable role in consolidating the political foundation of our relations. In recent years, leaders of the two countries have maintained regular contact on major issues of shared interest through meetings and correspondence, giving a strong boost to the improvement and development of bilateral relations. We should keep this momentum of exchanges and at the same time expand dialogue and communication between the governments, legislatures and political parties. We hope more delegations from the Canadian government, parliament and political parties and friends from various sectors will visit China.

- To advance China-Canada relations, we should fully tap our potential and broaden practical cooperation. Trade between China and Canada has enjoyed continuous growth for many years, but given the total size of our respective economies and cooperation potential, the volume of our trade and investment is still modest. Bilateral trade accounts for merely 1% and 6% of the total foreign trade conducted by China and Canada respectively. We welcome the Canadian government's active efforts to pursue the trade diversification strategy. We support companies of our two countries in conducting cooperation in information technology, energy and resources, infrastructure, transportation, environmental protection and agriculture to achieve mutual complementarity. We will also encourage Chinese enterprises to actively participate in Canada's Pacific and Atlantic Gateway Strategies. We hope the two sides will jointly oppose trade and investment protectionism, properly handle trade issues, build a more enabling environment for our business relations and make Canada an even more important trading partner of China.

The priority task for all countries at present is to tackle the global financial crisis. China's economy has also been affected by the financial crisis and we are facing increasing difficulty in economic operation. To meet the crisis, we have made timely adjustment to our macroeconomic policy, shifting focus to expanding effective domestic demand, especially consumer demand in boosting economic growth. We have adopted a proactive fiscal policy and moderately easy monetary policy and introduced a stimulus package that has six major components: first, increase public spending by RMB four trillion yuan; second, implement structural tax cuts worth RMB 500 billion yuan; third, preserve sufficient financial liquidity; fourth, carry out readjustment and revitalization programs in a wide range of industries; fifth, vigorously expand domestic consumption market, especially the rural market; and sixth, accelerate those key projects related to people's well-being.

This stimulus package has produced initial results and positive changes have taken place in the economic operation. The situation is better than expected. First, investment is growing at a faster pace and consumption is rising fairly rapidly. The GDP grew by 6.1% in the first quarter of this year. Second, industrial production is developing steadily and agriculture enjoys overall stability. The added value of industries above a designated scale increased by 7.3% in April over the same period last year. Third, good progress is being made in structural adjustment, development in various regions has become more balanced and industrial upgrading is gaining speed. Fourth, more urban dwellers have found jobs and people's income has increased. In the first quarter of the year, 2.68 million new jobs were created, and per capita disposable income of urban residents and per capita cash income of farmers rose by 11.2% and 8.6% respectively over the same period last year. Fifth, there is adequate liquidity in the banking system and financial markets are functioning smoothly. The RMB lending by financial institutions in the first three months increased by 29.78% over the same period last year. All these achievements show the measures that we have adopted are not only conducive to our own economy but also have produced positive impact on the economies of the region and the world as a whole.

Since the outbreak of the financial crisis, our two countries have had good consultation and coordination. Both China and Canada support deeper international economic and trade cooperation, enhanced international dialogue and coordination on macroeconomic policies and reform of the international financial system. We both believe that international cooperation on financial regulation should be strengthened to prevent the buildup and spread of financial risks. China stands ready to work with Canada to step up consultations and coordination in these areas. We would also like to make joint efforts with Canada and other parties concerned for more positive outcomes at the third G20 financial summit in Pittsburg on the basis of the two previous summits.

The enormous potential of our cooperation is also reflected in a wide range of other areas. China and Canada should actively pursue the converging interests, expand mutually beneficial cooperation and enrich the strategic content of the bilateral relations in the fields of counter-terrorism, justice, law enforcement, science, education, culture and health and on global issues and regional hotspots such as UN affairs and climate change.

- To advance China-Canada relations, we should respect and accommodate each other's concerns and properly handle sensitive issues. The question of Taiwan concerns China's sovereignty and territorial integrity and represents China's core interest. Relations between the two sides of the Taiwan Straits have been improving and have embarked on the track of peaceful development. Improvement and development of cross-Straits relations have not only brought real benefits to people on both sides, but also served the common interest of the international community, including Canada. We will continue to work for new progress in the peaceful development of cross-Straits relations in line with the principles of establishing mutual trust, laying aside disputes, seeking consensus while shelving differences and jointly creating a win-win situation. I should like to point out here that no matter how the cross-Straits relations may evolve, the Chinese government's commitment to the one China principle and its opposition to "Taiwan independence" separatist activities, and to "one China, one Taiwan" or "two Chinas" will never change. We hope that Canada will abide by the one China policy, prudently and properly handle Taiwan-related issues and support the peaceful development of cross-Straits relations.

Like Taiwan, Tibet-related issues also concern China's core interest. Tibet has been an inalienable part of China's territory since ancient times. The system of regional ethnic autonomy is practiced in Tibet and people's human rights and freedom of religious belief are protected according to law. We are committed to preserving the fine traditional culture in Tibet. Our difference with Dalai is not about ethnic relations, religion or human rights. It is about whether we should safeguard China's unity or allow Dalai to split the country. It is therefore a major issue of principle. Our policy toward Dalai is consistent and clear, and the door of dialogue and contact with the Dalai side has always been open. What is most important is that Dalai should truly abandon his propositions seeking Tibet independence, semi-independence or independence in a disguised way. We hope that Canada will continue to honor its commitment of recognizing Tibet as part of China and not supporting "Tibet independence", and understand and respect the Chinese people's position of upholding state sovereignty and territorial integrity.

- To advance China-Canada relations, we should expand people-to-people and cultural exchanges and enhance public support for our bilateral ties. China has a history that stretches 5,000 years and its 56 ethnic groups have jointly created the splendid and diverse Chinese culture. Canada is a country that believes in cultural diversity and harmonious coexistence of all ethnic groups. We want to work with you to expand exchanges in culture, education, sports and the academic field and boost our personnel interactions, especially those between young people with a view to enhancing mutual understanding and friendship between our two peoples.

Ladies and Gentlemen,

Dear Friends,

China actively supports Vancouver in hosting the 2010 Winter Olympic Games. We appreciate Canada's strong support for the Shanghai World Expo next year and will provide Canada with convenience and assistance in its participation. We are confident that the Vancouver Winter Olympics and the Shanghai World Expo will become new platforms for us to promote China-Canada friendship.

Ladies and Gentlemen,

Dear Friends,

Next year, we will celebrate the 40th anniversary of diplomatic ties between our two countries. We should be proud of what we have achieved in the bilateral relations and should actively push for new and greater development of China-Canada relations at a new historical starting point. We stand ready to work with Canada, take a strategic and long-term perspective, seize the opportunity brought by the 40th anniversary to review the past and plan for the future, and jointly forge an even better future for China-Canada relations. In this respect, we hope and we believe that we can continue to count on the strong support of the Canada China Business Council and visionary people from all sectors of Canada.

Thank you.