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Cover Story
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UPDATED: May 6, 2013 NO. 19 MAY 9, 2013
Forging Partnerships
French president's China visit has lasting political and economic significance
By Ding Ying

Strengthened bilateral cooperation will bring benefits to both countries. "A good China-France relationship not only will benefit the two sides, but also is very important for deepening China's cooperation with the EU," said Qu.

Dragged down by a poor economy, France's influence inside the EU is declining in comparison with neighboring Germany. France has been ambitious in maintaining its major influence in the world. In recent years, however, it has come to realize that without support from other big powers including China, its diplomatic ambitions will be difficult to materialize, said Zhang.

Economic ties

Currently, France is still suffering from the European debt crisis. It urgently needs to promote economic, trade and financial cooperation with China. At the same time, China is at a key phase of transforming its economic development mode and adjusting its economic structure, during which it requires a massive amount of technology and equipment from other countries. Common needs and mutual benefits provide a strong foundation for enhancing economic and financial ties.

During the French president's trip, the two sides agreed on a string of deals, including one for China to purchase 60 Airbus passenger planes. Moreover, enterprises from both sides signed agreements on energy saving, environmental protection, trade of agricultural and medical care products as well as traditional sectors including aviation, nuclear energy and the auto industry.

"China and France are highly complementary to each other economically and there is immense potential for cooperation between the two countries," Xi said in a speech in front of hundreds of Chinese and French businesspeople at a business forum alongside Hollande. He added that the two sides should boost economic cooperation "with a strategic view" and explore new fields to establish a close, permanent and sustainable economic partnership.

For his part, Hollande expressed his appreciation for China's support for Europe's efforts to resolve the debt crisis. He hopes to cooperate with China and expand two-way trade and investment in pursuit of common prosperity.

Zhang said France is facing a growing economic challenge due to the European debt crisis. According to Zhang, the French economy had a low increase of 0.1 percent in the first quarter of 2013, while the country's unemployment rate rocketed to over 10 percent. The country's national debt has exceeded 90 percent of its GDP, and is on the rise. Meanwhile, France's export volume, along with its competitiveness inside the EU, is sliding. Hollande's approval rating has fallen to 26 percent.

"France is in danger of a full economic recession, and the Hollande administration's top priority now is the development of the economy," Zhang said.

Under these circumstances, developing closer economic ties with China is of utmost importance for France. China is France's top trade partner in Asia, and its second biggest exporter in the world. Bilateral trade reached $51.02 billion in 2012, including $24.12 billion worth of Chinese imports from France, an increase of 9.3 percent year on year.

In January this year, the two-way trade volume reached $4.18 billion, up 5.3 percent from last year. China's imports from France stood at $1.83 billion, up 25.5 percent year on year. Although China's trade surplus still exists, France's exports to China are growing rapidly, which is very encouraging to the French. The figures show trade between China and France is on the way to more balanced growth.

France hopes to proceed with bilateral cooperation in the areas of nuclear energy and aviation, while enlarging its agricultural product exports to China, Zhang said.

The need is mutual. France is China's fourth biggest trade partner, fourth biggest investor and second biggest technology exporter in the EU. Wider cooperation will diminish trade imbalances between the two countries, when France provides more advanced products and technologies to China, said Qu.

Qu added that China's ongoing urbanization drive and the emphasis on domestic consumption have offered France a market with great potential. He noted that China's urbanization rate of 51.3 percent is far short of the over 70 percent rate seen in developed economies, offering France's city management a chance to help China address the challenges that surface during the process, including air pollution and food safety, Qu said.

In the cultural field, exchanges of visits between China and France have become more frequent in recent years. More and more young people have started to learn each other's languages, with China and France holding "language years" from 2011-12.

While promoting mutual understanding, communication between the two countries also creates a practical economic achievement. For instance, more than 1 million Chinese tourists visit France annually, helping to boost the French economy. In 2012, Chinese tourists spent over 75 billion euros ($98.75 billion) in France.

Email us at: dingying@bjreview.com

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