A NEW OPPORTUNITY FOR CHINA-BANGLADESH COOPERATION

– LI JUN –

Since the reform and opening-up in 1978, China has been making remarkable economic progress in all areas, which becomes a wonder to the world. Today, it’s not my intention to go into details, but I would like to share with you some economic statistics:

1. China’s GDP reached equivalent 9.4 trillion US dollars in 2013 (up 7.7 percent from 2012) and the number was only around 36.5 billion US dollars in 1978. The per capita GDP has grown from 149 US dollars in 1978 to around 6,900 US dollars in 2013.

Over the past three decades, China’s GDP has been increasing with an average annual growth rate of almost 10%. Given the lingering international financial crisis and the sluggish world economy in recent years, China’s role as the major engine of global growth is becoming indispensable.

The total value of trade in 2013 reached 4,160 billion US dollars (export, 2,209.6 billion; import, 1,950.4 billion). China surpassed the United States and became the world’s largest trading nation in 2013.

China attracted a record $117.6 billion of foreign direct investment (FDI) in 2013, rising 5.3% from 2012. At the same time, China’s outbound direct investment by non-financial firms jumped 16.8 percent to $90.2 billion from 2012. It is estimated that FDI outflows of China will surpass inflows in the near future.

4. China’s foreign reserve hit 3.82 trillion U.S. dollars at the end of 2013, 509.7 billion US dollars more than 2012.

Average life-expectancy of Chinese population has increased from 35 in 1949 to 76 in 2011. All school age children can enjoy free nine-year compulsory education. 95% of the Chinese people both in rural and urban areas, are covered by the cooperative medical care system, which primarily financed by the government.

In a word, reform has completely changed China. No one can image that such a job could have been done in such a short time. But this would have never happened without reform.

China’s comprehensively deepening reform

Since 1978, China has witnessed several rounds of reform.

The first round of reform started at 1978, which mainly focused on reform in rural area. The Chinese government implemented a policy so-called “Household Contract Responsibility System”, which links personal income to an individual’s contribution. The system was a milestone in releasing productive forces in the vast rural hinterland. At the same time, with the establishment of Special Economic Zones and the reform of state-owned enterprises, the planned economic system was broken up gradually.

The second round of reform began with China’s accession to World Trade Organization (WTO) in 2001. The Chinese government decided to establish a socialist market economic system and made great efforts on urban reform and internationalization of China’s economy. Deeply involved in global cooperation, China seized the opportunities brought by globalization of world economy and achieved tremendous economic success.

bd-chinaThirty-five years on, reform resolved successfully a host of old problems facing China. At the same time, we have many new challenges ahead of us, such as:

• How to crack the problems arising in the course of development?

• How to avert risks of various kinds?

• How to promote sustainable economic and social development?

China’s answer is pushing forward a new round of reform with greater political courage and wisdom as well as more aggressive measures. Last November, the Third Plenum of the 18th Communist Party of China (CPC) Central Committee hammered out a blueprint for comprehensively deepening China’s reform. We might consider this as the beginning of the third round of reform. Therefore, I would like to share with you the key points of the Plenum and the reform plan as follows:

•The general objective of the new reform is to improve and develop socialism with Chinese characteristics, push on with modernization of the country’s governing system and capabilities and ultimately promote social fairness and people’s livelihood.

•The plenum specified 300 measures for 55 reform tasks in 15 sectors covering economy, politics, culture, social development, environment sustainability, national security and etc. A key area is economic reform. The kernel of this issue is to establish a proper relationship between the government and the market. Such a relationship should allow the market to play a decisive role in allocating resources, yet at the same time enable the government to play a more effective supervisory role.

•The plenum gave a schedule to accomplish all reform tasks and achieve conclusive results in key areas by 2020. This means the reform process will be both measured and evaluated.

•The newly founded Central Taskforce on Deepening Reform, which is under the direct leadership of President Xi Jinping, will be the headquarter of reform. It is tasked with overall planning, coordination, monitoring implementation of reform measures and achieving synchronized progress. It will ensure that reforms across China take place in a systematic, universal and balanced way. Besides, it will guarantee reform measures are aligned in policy objective, enhance each other in enforcement and complement each other in results.

The reform in the past thirty five years has lifted China out of poverty and backwardness. The Third Plenum has sounded the clarion call for a new wave of reform, and I believe the new round of reform will realize the great revitalization of the Chinese nation and make true for China’s 1.3 billion people – the “Chinese Dream”.

The global impact of China’s reform

China, a major country with a population of 1.3 billion, is moving fast towards modernization. This is an extraordinary historic process unfolding before our eyes and the greatest contribution of the Chinese nation to human progress. We are not just responsible for our own country and people, but also ready to honour our due obligations to the world. The new round of reform in China serves both the interests of the Chinese people and the need of countries of the world. We will speed up the shift of the growth model, intensify efforts to upgrade and improve the quality and efficiency of growth, get beyond the “middle income trap” and achieve sustainable development. An increasingly prosperous China that is committed to deepening reform means the following to the world:

— China will provide the world’s development with more “Chinese opportunities”.

First, market opportunities. Despite the lack of effective global demand, the potential of the Chinese market is still growing. Last year, the Chinese people bought 21 million cars, more than a quarter of global car sales. China’s annual imports are approaching US$2 trillion. And China is expected to import over US$10 trillion of goods in the next five years.

Second, investment opportunities. Despite financial constraints facing the real economy in the world, Chinese businesses are becoming a major source of international investment and financing. Last year, China’s non-financial outbound direct investment topped US$90 billion. In its new round of reform, China will encourage businesses and individuals to invest abroad and enter a new stage of overseas investment.

china-economyThird, growth opportunities. Despite the sluggish world economy, the Chinese economy, with a size of over US$9 trillion, remained one of the fastest-growing economies among the G20 in 2013 with a growth rate of 7.7%. Moreover, the growth was achieved in the course of accelerated structural adjustment and therefore it was growth in real terms. Estimates show that as long as China continues to grow at 7%, it will contribute to the growth of the world economy by one percentage point more each year. This is certainly great news to the world economy, given that the new round of reform will maintain China’s mid-to-high growth rate for a fairly long time to come.

Fourth, cooperation opportunities. Against the backdrop of tortuous global governance reform, the new round of reform in China will serve to safeguard the open world economy and the free trade regime. It will facilitate the healthy development of economic globalization and economic policy coordination among different countries.

—China will contribute more of the “Chinese power” to world peace.

First, China will remain committed to the path of peaceful development, and will encourage other countries to jointly uphold peaceful development. Peaceful development is the only choice we can make in an era of globalization, and it represents the direction of development and progress of mankind.

Second, China will undertake more international obligations. China will seek and uphold justice and equality in international and regional affairs, and play an even more active and productive role in resolving hotspot issues. China will develop itself through upholding world peace and will promote world peace through its own development.

Third, China will continue to handle disagreements and differences through equal-footed consultations. Under the prerequisite that the nation’s fundamental interests are safeguarded, we are ready to show our utmost sincerity and patience and remain committed to resolving differences through dialogue.

Fourth, China will work with other countries to safeguard human conscience and international justice. Past aggressors must never be allowed to reverse the history of aggression; past powers must never be allowed to once again embark on the evil path of expansion; and fascist or militarist ideas must never be allowed to revive, not in whatever form.

New opportunities for China-Bangladesh cooperation

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Since the establishment of diplomatic relations in 1975, China and Bangladesh have been good neighbours, friends and partners based on equality, mutual respect and mutual trust. In 2010, the leaders from the two countries announced that they committed to establishing a “Closer Comprehensive Partnership of Cooperation”. In 2013, the bilateral relationship has maintained a good momentum of development:

•Frequent high level visits were witnessed. The Honorable Speaker, the Foreign Ministry & Foreign Secretary and many Minister level officials of Bangladesh Government visited China. Two Vice Governor of Yunnan Province, Vice Minister of Communication and special envoy of Chinese Foreign Minister visited Bangladesh.

Furthermore, thanks to the strong support of Bangladesh, the Initiative of Bangladesh-China-India-Myanmar Economic Corridor has made substantial progress.

•China-Bangladesh trade volume reached a record high of 10.3 billion US dollars with a growth rate of 21.9% compared with 2012, 10 times that of 2002.

•The accumulated investment (including investment from Hong Kong & Taiwan) in Bangladesh EPZ reached 1.42 billion US dollars at the end of 2013, providing jobs for more than 76,000 Bangladeshis. Several more big investment projects are in the process of negotiation between the two sides. At the same time, a growing number of Bangladesh business people are now conducting business in China.

•Chinese accumulated aid to Bangladesh reached 1 billion US dollars at the end of 2013. Six friendship bridges in Bangladesh have been built, and the Seventh is under way. Many other mega infrastructure projects are under construction with Chinese fund and technical support.

•The traditional relationship in defence area has become more robust. Both Bangladesh Army Chief and Navy Chief visited China in same year. Several warships from China entered Bangladeshi Navy service. The Chinese Navy Hospital ship “Peace Ark” visited Chittagong and provided free medical treatment to thousands of Bangladeshi people. Besides, people-to-people exchanges are intensified.

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China’s reform will provide the world’s development with more “Chinese opportunities”. It is estimated that in the next five years, China will invest an additional $500 billion in other countries, import over $10 trillion of products and send 400 million tourists abroad. Since Bangladesh locates geographically close to China, has cheaper labour force, friendly investment environment and beautiful landscape like Cox’ bazaar, it deserves to have more privilege to make good use of “Chinese opportunities”. I believe, with completion of the BCIM Economic Corridor, Bangladesh will take an even more favourable posture.

The first joint group meeting of BCIM countries was successfully held in Kunming, China last December. The four countries agreed that the priorities of BCIM Economic Corridor should focus on, among other things, the following areas: regional connectivity, including transportation, telecommunication, and power & energy, trade and investment, sustainable development and people-to-people exchange. Therefore, I think China and Bangladesh should intensify interaction and cooperation with each other in the following aspects:

•Strengthening political trust. China and Bangladesh should maintain the momentum of friendly exchanges between governments, parliaments and political parties, especially high-level visits. With stronger mutual trust, we could promote the building of BCIM Economic Corridor more effectively.

•Promoting regional connectivity. Ancient Silk Road had connected us in history. We should work together to restore the road link in the region and explore railway, waterway and airline connectivity as well. Recently, Bangladesh Government has decided to fast-track 6 projects, including the Padma bridge, a deep-sea port and the metro rail. This clearly showed your determination to improve communications. And I am quite confident to say Bangladesh, which is sandwiched by South Asia, Southeast Asia and East Asia, has the potential to become the regional transportation hub. China will continue to facilitate Bangladesh in this regard.

•Enhancing power & energy cooperation. Stable power and energy supply is the key for economic development. Bangladesh has been suffering for power shortage for long. While a lot of Chinese companies are highly experienced in grid network planning, power plant building and energy-saving technology. China is ready to enhance cooperation in power and energy with Bangladesh. Besides, we should push for closer coordination and cooperation in climate change and safeguard the common interests of developing countries.

•Pushing forward trade and investment cooperation. China will expand “zero tariff treatment” to Bangladesh goods and import more from Bangladesh. Since I took office as Chinese Ambassador to Bangladesh two years ago, I have received more than 200 Chinese entrepreneurs who wanted to invest in Bangladesh. Unfortunately, many of them were driven away by difficulty of land acquisition. I hope Bangladesh could make full use of its advantages to attract Chinese investment. I am happy to see that Bangladesh Government has preliminarily nodded for the Chinese Industry Zone. It is for sure that the establishment of CIZ will attract more Chinese investment, especially in the labour intensive industries. Hopefully, with more Chinese investment, Bangladesh export to China will get notable increase and the bilateral trade will be more balanced.

•Widening people-to-people exchange. As traditionally friendly neighbours, China and Bangladesh should pursue transportation connectivity as well as understanding and friendship between the two peoples. We should encourage people from all walks of life in the two countries to engage with each other.

•Strengthening security and anti-terrorism cooperation. No development could be achieved without sound security situation. In this regard, I have to mention with deep sadness of the terrorist attack conducted by Chinese separatists against innocent people in Kunming on 1 March. Both China and Bangladesh are victims of terrorism and extremism, we should strengthen exchanges and cooperation between the militaries and law enforcement departments to safeguard respective national security and stability and promote peace and stability in the region.

Chinese President Xi Jinping has outlined the vision of the Chinese dream, which is to achieve the great renewal of the Chinese nation. The new round of reform launched in China serves just as the right path that will lead us to this goal. The steady process of attaining the Chinese dream will not only benefit China; it will benefit the world at large. As President Xi Jinping pointed out, the Chinese dream of national renewal is about the pursuit of happiness by every Chinese, and it has much in common with the dream of the people in Bangladesh, as you are on the way to achieve the goal of becoming a middle-income country by 2021 and developed country by 2041. I am confident that with joint efforts of our two countries, China and Bangladesh will realise their dreams in the future.

(The article is a modified version based on the speech made at North South University, Bangladesh)

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