Chinese President Xi Jinping and his wife Peng Liyuan pose for a group photo with foreign guests attending the Boao Forum for Asia Annual Conference 2018 in Boao, south China's Hainan Province, on April 10 (XINHUA)
Amid a rising tide of trade protectionism in some parts of the world, Chinese President Xi Jinping has declared that China will expand its opening up and continue to advance cooperation with its economic partners.
Xi made the announcement while delivering a keynote speech to more than 2,000 politicians, scholars, and leaders in business and media from over 60 countries and regions at the Boao Forum for Asia (BFA) Annual Conference 2018 on April 10 in south China’s tropical Hainan Province.
President Xi Jinping meets with incumbent and incoming members of the Board of Directors of the Boao Forum for Asia in Boao, Hainan Province, on April 11 (XINHUA)
A more open country
The four-day conference is the first major diplomatic event hosted by China this year.
A series of key measures will be undertaken to broaden market access, create a more attractive investment environment, strengthen the protection of intellectual property rights (IPR) and expand imports.
Import tariffs for vehicles will be significantly reduced, Xi revealed in the speech, and the country will also work hard to increase imports, especially products that are competitive and needed by the Chinese people.
The president said that China does not seek a trade surplus and has a genuine desire to achieve greater balance in the current account.
Market access in China will be broadened to accelerate the opening up of the insurance industry, as well as to ease restrictions on the establishment of foreign financial institutions in China and expand their business scope, while more areas of cooperation between Chinese and foreign financial markets will also be opened.
Instead of primarily relying on favorable policies for foreign investors as in the past, Xi said that instead China will improve the country’s investment environment in order to attract foreign investment.
"We will enhance alignment with international economic and trading rules, increase transparency, strengthen property right protection, uphold the rule of law, encourage competition and oppose monopoly," Xi said.
Meanwhile, China is reinstituting the State Intellectual Property Office this year to step up law enforcement, significantly raise the cost for offenders and deploy relevant laws as a major deterrent.
"We encourage normal technological exchanges and cooperation between Chinese and foreign enterprises, and protect the lawful IPR owned by foreign enterprises in China," Xi said.
Speaking of the first China International Import Expo to be held in Shanghai this November, another of this year’s major diplomatic occasions in China, Xi described the event as not just another expo in an ordinary sense, but a major policy initiative and commitment from China to open up its market.
Xi outlined these measures after first reviewing China’s successful experience over the past four decades since the adoption of reform and opening up in 1978.
Hailed as "China's second revolution," reform and opening up in China had not only profoundly changed the country but also greatly influenced the whole world, Xi said.
Figures from the speech show that over the past 40 years, China has recorded an average annual GDP growth rate of around 9.5 percent, cultivated a middle-income population of 400 million, and lifted more than 700 million people out of poverty, accounting for more than 70 percent of the global total. China has also contributed over 30 percent of global growth in recent years.
Xi's speech on the role of reform and opening up in boosting the development of China in the past four decades resonated with many of the scholars and other participants attending the BFA annual event.
Ban Ki-moon, former UN Secretary General and the newly elected Chairman of the Board of Directors of the BFA, described Xi's speech as "very important and inspiring." "President Xi Jinping announced in September 2015 the vision that he'll be committed to creating a community with a shared future that will inspire all member states. He continues this today," he said.
President Xi's speech underscored China's strong support for economic globalization, trade liberalization and connectivity, said Jon R. Taylor, a professor of political science at the University of St. Thomas.
"China has grown into the world’s second largest economy, the largest industrial producer, the largest trader of goods and the holder of the largest foreign exchange reserves," said Gu Xueming, President of the Chinese Academy of International Trade and Economic Cooperation of China's Ministry of Commerce. "It could not have reached these heights without the reform and opening-up process. All of these achievements are not easily attained."
"Protectionism prevails in today's world, and the United States puts this idea into practice by imposing heavy tariffs on certain goods imported from China," said Xu Xiujun, a professor with the Chinese Academy of Social Sciences. "The open global economy is now faced with more arduous challenges than ever before."
"China's development has contributed to the overall progress of the world. An open China will exert a more central role in promoting the regional integration of Asia and the globalization of the world," Xu said.
Aravind Yelery, Assistant Director of the Delhi-based Institute of Chinese Studies, applauded Xi's address. Yelery believes that a more open China will bring opportunities to Indian businesses investing in the country. "India has been looking for initiatives and opportunities for ways to engage with China, and the policy of opening up further is good news," Yelery said.
Christian Rainer, publisher and Editor in Chief of Austria-based news magazine Profil Redaktion GmbH, shares a similar view. He said that China’s decision to further open up will bring more opportunities for trade and investment from Austria, especially for the automotive industry as there are tens of thousands of people in Austria working in this industry. “This is very good for the Austrian people and the Austrian economy.”
"Xi's speech shows that China proceeds toward action in a very deliberate and active way," said Allan Gabor, President of Merck China, who has been living in China for 20 years. "For those of us in the business community, the speech provides a lot of transparency and stability. It is very important to us," he added.
Apart from emphasizing China's designs for further opening up in his speech, Xi also reflected on the achievements of the Belt and Road Initiative. "The Belt and Road Initiative may be China's idea, but its opportunities and outcomes are going to benefit the world," Xi said, adding that China has no geopolitical ambitions, seeks no exclusionary blocs and imposes no business deals on others.
He also pointed out that as the Belt and Road is a new initiative, it is natural that there might be different views on cooperation. "As long as the involved parties embrace the principle of extensive consultation, joint contribution and shared benefits, we can definitely enhance cooperation and resolve any differences," Xi said.
"This way, we can make the Belt and Road Initiative the broadest platform for international cooperation, in keeping with the trend of economic globalization and to the greater benefit of all our peoples," Xi said, adding that China will not threaten anyone else, attempt to overturn the existing international system, or seek spheres of influence, no matter how much progress it has made in development.
Xu Hongcai, a research fellow with the China Center for International Economic Exchanges, echoed Xi's remarks. Xu Hongcai revealed that the world economy is projected to grow 3.9 percent year on year in 2018, compared to 3.6 percent last year. However, it is still below the average growth rate prior to the 2008 financial crisis.
"Currently, trade protectionism is rising. Against this backdrop, China is obligated to call on all parties to work together in the spirit of openness and oppose protectionism and unilateralism," Xu Hongcai said. “Cooperation is essential to global economic development."
Recently, there have been positive developments in Northeast Asia with improvements in China's relations with Japan and South Korea, as well as a possible turnaround in the North Korean nuclear issue. "China hopes countries make the most of this window of opportunity to jointly promote peace, stability, cooperation and development in the Asia Pacific region," Xu Hongcai said.
With the recent conclusion of the annual sessions of the Chinese People's Political Consultative Conference National Committee and the National People's Congress of China, and the 19th National Congress of the Communist Party of China in 2017, China has vowed to promote an open economy of higher quality and greater openness.
"From the platform of the BFA, China once again voiced its stance and determination for further economic liberalization, which will contribute to the advancement of the Asian and world economies," Xu Xiujun said.
"The Belt and Road Initiative is important for all the countries that are attached to it," Gabor said. "China is a very important country for the world. The better China does, the better the world does."
"The initiative is one of the instruments to implement the vision of a shared future for mankind," said Giulio De Metrio, Chief Operating Officer of SEA, Italy's major airport operator. "It is a way of bringing more prosperity to neighboring countries. A good neighbor for China is also a good neighbor for Europe."
Metrio said they are very interested in increasing the connectivity between China and Italy. "Currently there are three daily flights to china--to Beijing, Shanghai and Hong Kong," Metrio said. "We hope to have more airlines connecting Milan to other cities in China, including Chengdu, Chongqing and Guangzhou."
(Reporting from Boao, Hainan Province, with contributions from Hou Weili and Liu Ting.)