SCIO briefing on China's commerce development in 2015

Gao Hucheng:

Positive progress has been made in the construction of economic and trade cooperative zones between China and other countries. There are many examples, such as the ones in Pakistan, Sri Lanka, Belarus, Thailand, Egypt and Kenya. We have established 75 such zones yielding substantial taxation and employment for the countries of cooperation. Statistics show taxes paid to the target countries by Chinese-invested companies hit US$100 billion in the past four years and the number of indigenous employees hired by them from the target countries approached 900,000. We believe that, as long as we adhere to the principles of mutual consultation, construction and sharing, China and other countries can definitely brainstorm with and meet each other halfway, so that "the Belt and Road" initiative will be more fruitful, benefit an increasing number of countries and their people, and contribute to the prosperity and development of the global economy.

Now let's turn to the topic of Trans-Pacific Partnership Agreement (TPP) about which you have some concern. Actually, I have responded several times to this issue. Let's recall a statement issued at the informal leadership meeting of APEC hosted by China in 2014 that pointed out both the TPP and Regional Comprehensive Economic Partnership (RCEP) are choices and paths for the promotion of the construction of a free trade zone in the Asia Pacific Region. Therefore, China has a liberal attitude towards any free trade pacts as long as they are open, inclusive and transparent. The full text of the official document of TPP was not released until the signing ceremony in Auckland, New Zealand, on February 4, this year. Now, the full text translated from English to Chinese, with main content of about 600 pages and 3,900 pages of attachments have been posted on the website of the Chinese Academy of International Trade and Economic Cooperation affiliated to the Ministry of Commerce. It provides reference to scholars and industrial insiders for scrupulous research and assessment. Because there are diversified levels and phases regarding the developments of different countries, the assessment will take time to finish. However, we do not believe the TPP is designed to constrain China, neither do we believe the TPP and RCEP are opposed to each other. On the contrary, they are proceeding abreast without contradiction. We'll continue to press ahead with the research launched during the 2014 informal leadership meeting of APEC on the strategic framework for the construction of a free trade zone in the Asia Pacific Region.

Last, but not least, in view of the rules of global trade and investments which have evolved to the present form, the multilateral and regional systems are running simultaneously and in a coordinated way. When multilateral cooperation goes fast, the regional system will slow, and vice versa. However, they are ultimately to be incorporated into a globally unified and regulated multilateral trade framework. Why? The answer is simple: whenever a free trade pact is enacted, regardless of its criteria and openness, its primary concern is the development of its members. However, as long as we attempt to form a universal rule globally, the major issue for us is to take the market for consideration. Whatever the criteria are, without the involvement of market factors, they are meaningless.  The RCEP has paid attention to that point as the system features the largest diversity of conditions for the layout of regional trades. The arrangement was initiated by the ASEAN (Association of Southeast Asian Nations) in 2011, as the association established free trade zones involving six countries through five agreements. It signed the pacts with Australia and New Zealand, South Korea, Japan and India. It has also upgraded its free trade zone with China this year. The RCEP generally refers to the negotiations of 10 ASEAN members plus six other countries.

Why did I say the differences are remarkable? Let's take a look at the constitution of the "10+6." Among the countries, choices for the development paths and political models vary greatly; meanwhile, the GDP per capita differs from US$1,000 in one country to US$50,000 in another. Besides, the territories of the countries differ from dozens of square kilometers to hundreds of thousands square kilometers, and in China it reaches 9.6 million square kilometers. The differences are remarkable. I also wonder why seven members of RCEP are also TPP members. Based on my study, despite the huge differences in development phases and other respects among the countries, both the TPP and RCEP are choices and paths leading to the establishment of a free trade zone in the Asia Pacific Region as long as the principles of inclusiveness, openness and transparency are upheld. Thank you!

Guo Weimin:

To offer more opportunities for other journalists, I kindly remind you of asking one question per person.