Address by H.E. Xi Jinping
President of the People's Republic of China
At APEC Economic Leaders' Meeting Session I
On Global Economic Situation and Multilateral Trading System
Dr. Susilo Bambang Yudhoyono, President of the Republic of Indonesia,
Dear Colleagues,
It is a great pleasure for me to discuss with you the world economy and the future of Asia-Pacific cooperation on this beautiful island of Bali. Let me first of all express my sincere thanks to you, President Susilo Bambang Yudhoyono and the Indonesian government, for making thoughtful arrangements for this meeting.
The world economy is on the whole moving forward in a positive direction, yet uncertainties and destabilizing factors have remained prominent. The underlying impact of the international financial crisis is still there, and cross-border financial risks must not be left unheeded. The structural problems of major developed economies are far from being resolved, and it has become more imperative to enhance macro-economic policy coordination. With growing external risks and pressure, some emerging economies in the Asia-Pacific are experiencing turbulence in the financial markets and slowdown of economic growth. With slow progress in the WTO Doha Round negotiations, trade and investment protectionism has resurfaced. The world economy faces daunting challenges before achieving full recovery and sound growth.
APEC, which is entrusted with the important mission to promote regional and global growth, must face the challenges head-on with courage and resolve. It should play a leading and coordinating role in maintaining and advancing an open world economy, and in making sure that the Asia-Pacific continues to serve as an engine for global economic recovery.
First, work together for the common development of the Asia-Pacific through increased macro-economic policy coordination. With our economies all closely intertwined in economic globalization, we must amplify the positive effects of macro-economic policy coordination while preventing or reducing the negative spillovers. We must pursue win-win cooperation in an open and inclusive spirit. Our efforts should not be uncoordinated or even cancel each other out. Major reserve currency issuing economies should implement responsible macro-economic policies. They should act cautiously in adjusting their policies, monetary policies in particular. Be it the adoption or withdrawal of a policy, they must take into account its possible impact on the region and increase communication and coordination with other economies.
APEC should play a similar role in promoting an open environment for development in the Asia-Pacific, featuring policy coordination, interconnected growth and converging interests.
Second, maintain economic and financial stability in the Asia-Pacific through factual assessment of the situation and cool-headed response to the challenges. World economic fluctuations have brought challenges to the financial market, capital flow and exchange rate stability in the Asia-Pacific, exposing the region to more economic and financial risks. We must prevent risks from piling up and causing major economic and financial turbulence in the Asia-Pacific. We must support economic policies with social policies to prevent economic and financial risks from developing into political and social problems.
Having said that, we recognize that the Asia-Pacific region's common aspiration for peace, stability and development has not changed, nor has the historical trend of its growing status and role in the world political and economic landscape, or the driving force and potential for its rapid and sustained economic growth. Asia-Pacific economies have learned lessons from their past experience and significantly enhanced their capabilities to fend off risks. We have every reason to be confident about the future of this region.
Third, take a long-term perspective, promote profound economic restructuring by member economies and give stronger impetus to the sustained development of the Asia-Pacific. If we do not plan for the future, we will have immediate worries. While addressing problems at hand, it is all the more necessary to plan for the future. The key to long-term development lies in reform and innovation. We must transform the current economic development model, adjust economic structures, advance reform and innovation, and release the potential of domestic demand, the impetus of innovation and the vitality of the market, so as to provide internal driving force for sustained and sound economic development. Reform is never smooth sailing. All member economies, both developed and developing, should be prepared to bear necessary costs for reform. The inherent difficulty of reform entails extraordinary courage, and only persistent efforts befit this commendable cause.
Asia-Pacific economies should accelerate readjustment of their respective economic structures and deepen the integration of the industrial chain and the value chain so that the Asia-Pacific will take the lead globally in forming new industrial clusters for growth and continue to serve as an important engine for the world economy.
Dear Colleagues,
The Ninth WTO Ministerial Conference to be held in two months will have an important impact on the destiny of the Doha Round negotiations and the multilateral trading system. In the meantime, the various free trade arrangements in the region are advancing in parallel, each with different rules, standards and preferred pathway. Here, I wish to propose the following:
First, promote economic integration of the Asia-Pacific through synergy. China is open to all institutional arrangements that are conducive to Asia-Pacific regional integration. China also believes that any arrangement should lead to a cooperative relationship, not a confrontational one, an open mindset, not an exclusive one, win-win results, not a zero-sum outcome, and integration, not fragmentation. We must foster a culture of integration and complementarity through mutual learning and reinforcement.
APEC members should embrace the principles of openness, inclusiveness and transparency and the spirit of flexibility, establish and launch as early as possible an information exchange mechanism for free trade areas. APEC should play a leading and coordinating role. Regional free trade arrangements should keep APEC leaders informed of the progress made in their negotiations and results achieved in this regard, and improve communication and exchange of views to create favorable conditions for the eventual realization of a free trade area of the Asia Pacific (FTAAP).
Second, stay committed to open development and resolutely oppose trade protectionism. Economies prosper in openness and falter in isolation. This year's meeting has come back to the birthplace of the Bogor Goals and is therefore of special significance. We must stay committed to the spirit of the Bogor Goals and to open regionalism. One should not just sweep the snow in front of his own home and ignore the frost on the roof of his neighbor. The developed members should set a good example in opening their markets wider, give higher priority to economic and technical cooperation, and help developing members enhance their competitiveness.
Third, inject new impetus to multilateral trading regime with firm confidence. APEC has been a staunch supporter of the Doha Round negotiations, just as it had played an important role in concluding the Uruguay Round. Standing at a similar historical moment, we must have the courage to assume our responsibilities and send a strong political signal for advancing the Doha Round negotiations. We should give our trade ministers more political guidance and flexibility, and encourage the parties to achieve an early harvest, work for the full conclusion of the Doha Round with strong determination, and develop a roadmap for this purpose.
Dear Colleagues,
APEC is now entering another development stage. At this new historical starting point, let us work together in the spirit of openness, inclusiveness, cooperation and mutual benefit and enable APEC to play an even greater role.
Thank you.
