China-Australia Cooperative Relations
Have a Bright Future
 — Speech by Amb. Zha Peixin at the Seminar on China-Australia Relations

       Today, we are gathering here to commemorate the 35 anniversary of the establishment of diplomatic relations between China and Australia. It is my great pleasure to participate in this conference. After reviewing the development of Sino-Australian relations over the past 35 years and looking at the various aspects of this relationship, I wish to emphasize the following points:
       1. Remarkable achievements have been made in various fields due to the joint efforts of our two governments and peoples, which have brought tangible benefits to our two peoples.
       The past 35 years have witnessed frequent high-level visits between the leaders of our two countries, as a result mutual trust has been strengthened. In November 1973, Gough Whitlam became the first Australian Prime Minister to visit China. Since then, all the Prime Ministers of Australia have paid visits to China, and the current Prime Minister Howard has been to China six times. In 1999 when then Chinese President Jiang Zemin visited Australia, the two sides reached consensus to establish a comprehensive long-term stable and healthy partnership toward the 21st century. In 2003, during President Hu Jintao’s state visit to Australia, this relationship has been further deepened. In 2006 when Premier Wen Jiabao visited Australia, the two sides agreed to develop the comprehensive cooperative relations with mutual benefit and win-win results in the 21st-century. In September this year, President Hu Jintao is again going to pay a state visit to Australia, availing the opportunity of the APEC meeting. These high-level exchanges and contacts will definitely inject new vigor to our bilateral relationship.
       The cooperation in the fields of economy, trade and investment between our two countries has been developing rapidly. In the early 70’s, what we had was limited amount of trade in wheat and wool. Today, China has become Australia’s second largest trading partner, the fastest growing export market and the second largest export destination, while Australia has ranked as China’s ninth biggest trading partner and the biggest supplier of wool. The total trade volume of the two sides has increased to nearly 33 billion US dollars in 2006, at a growth rate of 20.9% compared with the same period the year before. The negotiation on China-Australia Free Trade Agreement (FTA) has entered into a substantial stage. Mutual direct investment has reached a new high, and continues to gain new momentum.
       The cooperation in the areas of science and technology, education, culture, and tourism has also been developing steadily. This February, China-Australia Agreement on Cooperation in the Peaceful Uses of Nuclear Energy and Agreement on Transfer of Nuclear Material came into force. Today, nearly 100,000 Chinese students are studying in Australia. Chinese has become the second most popularly spoken language in Australia only next to English. Each year, some 800,000 people from both countries visit each other and China has become the country with the fastest growth in the number of foreign tourists visiting Australia. By the end of 2006, 67 pairs of friendly provincial or sister city relationship have been established among the two countries.
       Besides, our two countries have maintained good consultation and coordination on regional and international issues. Foreign Ministers of the two countries have established very good working relations by holding meetings and exchanging views from time to time, including on such multilateral occasions as ARF and APEC.
       Premier Wen and Prime Minister Howard both have stressed more than once that the China-Australia relations today is better than any time. The good relationship has not only brought tremendous and tangible benefit to the peoples of our two countries, but also contributed to the peace and stability of Asia-Pacific region as well as of the whole world.

       2. There is still great potential to be exploited in the bilateral relations. The prospect for this relationship is indeed very bright.
       Firstly, China and Australia have neither historical grievances nor conflict of fundamental interest. On the contrary, our common grounds have been increasing. For example, in the area of security, the post-cold war era we are at is characterized by the mixture of traditional and non-traditional security threats.  Terrorism has become one of the biggest threats. No single country can deal with it successfully alone. Other trans-national issues also call for joint efforts and cooperation between countries.
       As important countries in the Asia-Pacific region, both China and Australia have the responsibility of maintaining peace and stability and promoting prosperity in the region, we have all the reasons to frequently exchange views on all important international and regional issues and co-ordinate and cooperate in whatever area where there is a possibility. China and Australia both are members of many important international and regional organizations. We should and can have even better cooperation within these organizations.
       Secondly, our two economies are highly complementary to each other, and there exists great potential for further cooperation in the fields of economy, trade, energy and resources.
       Though Sino-Australian economic and trade relations have been expanding rapidly, however, the trade volume between the two countries is still relatively small in comparation with the size and scale of the two economies. For instance, our two way trade only takes up less than two percent of China’s total foreign trade.
       Australia is rich in natural resources. Its iron ore, aluminum, grain products and wool have great market potential in China. Now China is endeavoring to scale up its output of nuclear power while Australia has 40 percent of the world's proved uranium reserve. Long-term, large-scale and stable cooperation could be reached in the fields of energy and resources.
       Thirdly, there are many other areas where we can cooperate such as economic management, education, science and technology. In addition to its rich natural resources and primary commodities, Australia has many assets which it can bring to its relations with China. It has sound macro-economic management and rich experience in continuous micro-economic reforms. It has adopted best international practices to raise productivity and has a sophisticated business and financial sector, a highly developed service industry, a strong base of scientific and technological research, and above all, a well-educated work force. All these are useful to China, a country in reform and development, to overcome its weak points and break the bottlenecks it encounters. Each country has its own strengths as well as weakness. It is highly appropriate to cooperate with each other towards a win-win outcome for both.

       3. It is the most opportune time right now for the further development of Sino-Australian relations. Indeed, we are facing some golden opportunities.
       First, economic globalization has deepened inter-dependence. With international trade, direct foreign investment, and growing global financial market, the economy is increasingly internationally interconnected and thus economic globalization has become a macro background of the economic development in every country across the world. In the era of economic globalization, what happens in one country is no longer irrelevant to the other. If one is doing well, the other will benefit, likewise, if one is doing poorly, the other will also suffer. It is no longer the zero-sum game. The interests of countries are closely related to each other. It is of utmost importance to give full play to one’s comparative advantage, cooperate with other countries to make win-win situation for all. With the established links between China and Australia, economic globalization will draw the two countries even closer and open up new opportunities for the further development of all-round cooperation and exchanges between the two countries.
       Secondly, we are living in an era where science and technology are making rapid progress and breakthrough is expected in many fields. The world today is moving rapidly from industrial economy to knowledge-based economy. High-tech industries are playing an increasingly important role in economy. The traditional development model with natural resources, capital and labor playing the leading role is gradually giving way to the new model of relying on the development of science and technology, the development of knowledge, human resources, talents, invention and innovation. International cooperation in science and technology has become a trend of our times. More science is going to come from more people in more places. No single country is capable of fulfilling all the R&D alone. Australia is well in advance in quite a number of fields. Although China is still a developing country, it is also making huge progress in development of science and technology. China has established many centers of excellence. For instance, China is the third country in the world to send man into outer space. There are indeed many areas where our two countries can cooperate.
       Thirdly, the fast emerging of Asia has provided good opportunities for China-Australia relations. Asia is the largest continent in the world. It is also the continent with the largest population. At the moment, the economies in North America and Western Europe are larger than that of Asia, but Asia enjoys the fastest growth rate in the world, and many Asian economies are the most dynamic economies in the world. The most important emerging markets are in Asia. With the rapid increase of inter-regional trade and investment, regional cooperation and integration is also developing fast. Potential and growing importance is obvious to all. At present the overall situation in Asia remains stable. Peace, development and cooperation remain the major trend in the region. The prospect is very promising. Australia, as a country in the Asia-Pacific region, is closely connected with Asia. Its economy is complimentary to that of Asia. So the future prospect of Australia is undoubtedly closely connected with Asia.  
       Last but not least, China’s industrialization, urbanization, marketization and integration to the world economy have created enormous opportunities for the development of our bilateral relations. China will stick to the peaceful development, opening up, and building a harmonious society domestically and promoting a harmonious world internationally. As described by the government blueprint, China will double its per capita GDP of year 2000 by the year 2010 with an average annual growth rate of over 7.5%, while the energy consumption per GDP will be reduced by 20% and the total discharge of major industrial wastes will be reduced by 10%. To fulfill this goal, we have adopted a new concept to development which is people-oriented, comprehensive, well coordinated and sustainable development. The rate of urbanization right now is little over 40%, and is expected to increase at least 1% each year to reach 47% in 2010. Efforts will be made to optimize the industrial structure and product mix, improve efficiency, lower energy consumption and protect the environment.
       China has preliminarily established the market economic system. Right now market is already playing the main role in allocating resources in the development of China’s national economy. Further reforms will be carried out in various fields to make this market economic system more comprehensive and efficient. We will make further efforts to improve the protection of intellectual property rights.
       China will continue its endeavor to deepen the opening-up and further integrate with the world economy. It is pursuing the opening strategy of combining “attracting in and going abroad”, which has set up a new stage for the economic exchanges and cooperation between China and the rest of the world. In addition to the traditional practice of attracting foreign investment, more and more domestic enterprises are encouraged to step out of the country and expand their business abroad. In this way, China is becoming both a large destination and a growing source of investment.
       China's accession to the WTO is an unequivocal signal to the world of its determination to be more deeply integrated with the existing international system.
       China’s rapid, steady and sound development has created huge demand and provided tremendous opportunities for cooperation with Australia. At 2010, China’s import alone will exceed one trillion US dollars. China’s growth has become a strong impetus of the development of our bilateral relations.
       To take advantage of all the favorable conditions and opportunities above and to enhance the development of the relations between our two countries in the new century, there are a number of things we must do well.
       We should further strengthen the political communications between our two countries and enhance mutual trust. High level visits have been instrumental in the development of our relations, and we should keep this momentum. President Hu’s state visit in September is an important event in Sino-Australian relations. I’m sure the complete success of this visit will further promote our bilateral relationship.
       We should deepen the exchanges and cooperation between us in the fields of economy and trade as they serve as the foundation of our relationship. At the moment, efforts should be made to promote further cooperation in the field of natural resources and energy and speed up the negotiation on the bilateral free trade agreement so that substantial progress could be achieved.
       China and Australia should also further strengthen communications and consultations on major international and regional issues, and enhance cooperation in this respect. This is not only conducive to the peace, stability and prosperity of the Asia-Pacific region, but also the world at large.
       The fundamental to develop long-term and overall cooperative relations is the better understanding of each other between the two peoples. One of the best ways to enhance mutual understanding is to further the exchanges and cooperation between think tanks and scholars of our two countries, as they play an important role in educating the general public and leading the public opinion. The CPIFA is very pleased to have this opportunity to cooperate with the Lowy Institute this time to co-sponsor this conference and we are looking forward to continuing the excellent communication and cooperation between us in the future.

       Ladies and gentlemen,

       China-Australia relations have come a long way over the last 35 years. Our two countries differ in social system, historical background, cultural tradition, level of development and geographical position, and it’s only natural for us to have some differences from time to time, but our common interests far out weigh our differences. Our two peoples have always been friendly to each other and have good feelings for each other. Over the past 35 years, we have built a solid foundation. The leaders of our two countries attach great importance to this relationship. So long as we respect each other to deal with issues with sensitivity, look after each other’s concern, taking one’s own interest as well as other’s interest into consideration, bear the overall situation in mind and have long-term and strategic perspective, seeking common ground while narrowing our differences, and strive for a win-win situation, our bilateral relations will definitely be raised to a new level. With both opportunities and challenges ahead, let’s join hands and work together to build a even brighter and sounder China-Australia relationship.
       Thank you!