Right Honorable Prime Minister J. Ardern,

Right Honorable Former Prime Minister H. Clark,

Honorable Minister O’Conner,

Ladies and gentlemen,

First and foremost, I would like to acknowledge Mrs. Fran O’Sullivan, Mr. Michael Barnett, and NZINC and the Auckland Business Chamber for hosting this event, and to thank you for your invitation. Over the years, China Business Summit has evolved into a major platform and a signature brand for discourse on NZ’s relationship with China. It is a great honor and pleasure to join such an imposing constellation of guests and participants. Please allow me to take this opportunity to extend my deep appreciation to all friends who have been supporting the relationship. I am deeply impressed by the insightful remarks of PM Ardern and Minister O’Conner, and would like to share some of my thoughts and observations here.

In line with the focus of the Summit, let me start with the state of the Chinese economy. As you may be aware, promoting economic development, thus improving people’s lives and realizing the Chinese Dream of the Great Rejuvenation of the Nation, has been consistently THE overriding priority for the Chinese Communist Party and Chinese Government for the past 40 plus years. Looking back, the history of China’s development over that period is a history of ever deepening domestic reforms and closer integration with the rest of the world. Increasing openness has brought vitality to the country and has served as an important driving force behind the strong growth of the Chinese economy for decades. With mounting headwinds facing the world economy, it is only natural, though, for people to be concerned whether that same openness, together with the impact of the Covid-19 pandemic, may cast a shadow over the outlook of the Chinese economy.

True enough, the turmoils in the external environment and Covid have taken their toll. Nonetheless, the fundamentals underpinning the Chinese economy over the long run—remain unchanged. China is the world’s second largest economy, the largest trader of goods, the second largest consumer market with a middle-income community of more than 400 million people, and the holder of the largest foreign currency reserve. Both the scale and the systemic integrity of the Chinese economy contribute to its resilience. China is the only major economy in the world to achieve positive growth in 2020. In 2021, the Chinese economy grew by 8.1% year-on-year. In the first half of 2022, the economy still grew by 2.5%. What is particularly remarkable is that it managed to stay in positive territory in the Q2, at the height of the renewed surge in Covid case loads. In those 6 months,  China’s total import and export of goods increased by 9.4% year-on-year, with the consumer price index having risen by a mere 1.7% -- no small achievement given the runaway inflation in almost all other major economies around the world.   

Those hard-won achievements, although beyond expectations for some, should hardly have come as a surprise, as the major engines driving the growth of the Chinese economy remain strong.

The first of these engines is arguably the largest-scale, yet-to-complete urbanization and industrialization processes in human history, which, coupled with efforts to achieve high quality development and transition towards a greener economy, will  create enormous space for its growth and development for many years or even decades to come.    

The second such engine is China’s extra-large consumer market. Accounting for about 70% of the Chinese economy, consumption has already become by far the biggest source for its growth. In the coming 15 years, China’s middle-income community is expected to double to 800 million, which will further unlock its huge consumption potential, with implications for not only the endogenous factors for growth of the Chinese economy, but also for stakeholders in the Chinese market including many NZ businesses.

The third engine for China’s continued growth is innovation and the consequent upgrading and transformation of its economy. One important relevant indicator is that China already contributes one of the biggest cohorts of Fortune Global 500 companies from any single country. More importantly, over 50,000 small and medium-sized businesses specializing in new and high technologies have emerged in China since the outbreak of COVID. And rapidly increasing R&D investment and results have moved China up the global innovation ladder.

The fourth engine is the evolving institutional and regulatory regimes, through what we call the supply-side structural reforms, deep reductions in taxes and fees, and continuous efforts at improving the general business environment.

A final engine I would like to mention here for the growth of the Chinese economy is international cooperation. As both a producer and a market, China is deeply embedded in global value and supply chains. In the first half of 2022, China’s foreign trade amounts to 19.8 trillion RMB (4.7 trillion NZD), registering positive growth for 8 consecutive quarters, and maintaining a robust momentum for growth in the actual use of incoming FDI.

As you may know, the CCP will convene its 20th Congress in a few months’ time. The Congress will be another major milestone in the country’s development as it will elect the new leadership of the Party, and chart the course for the further development of the country and the realization of the Chinese Dream.

In a nutshell, going forward, the conceptual, paradigmatic shifts taking place in the Chinese economy will generate significant development dividends that will power high-quality development in China, and at the same time, contribute to growth across the world. 

In this process, China will continue to open up as a key to promoting reform, development and innovation and to addressing risks that may arise, as we continue to share opportunities from China’s development with the rest of the world through mutually-beneficial cooperation.

Just as President Xi Jinping has put it on many occasions, “No matter how the world changes, China’s faith in and its commitment to reform and opening-up will not waver.” “China’s door of opening-up will never close. It will only open wider.” 

In spite of the growing risks and uncertainties, China has not marked time in opening up to the world. Here are some of the steps we have been taking more recently:

-- We have further increased market access for foreign investors by shrinking the negative list for foreign investment on one hand, and expanding the positive list for areas where foreign investment is encouraged. We have also taken steps to improve the institutional backstop for servicing foreign investors.

-- We have stepped up high-quality international cooperation on the Belt and Road Initiative on the basis of mutually-beneficial partnership for open, green and clean common development. In the first half of this year, China’s two-way trade with BRI partner countries increased by 17.8%, double the rate of growth for China’s overall external trade, showcasing the strength of the initiative.

-- We have continued to support the multilateral trading system and oppose protectionism. China played a significant role in enabling MC12 of WTO to make progress on IPR waiver for Covid-19 vaccines, fishery subsidies and food security, helping to boost much-needed confidence in WTO and multilateral institutions more broadly.

-- We have made further progress in delivering on our commitment to building a network of high-standard free trade arrangements. The Upgrade Protocol of China-New Zealand Free Trade Agreement entered into force on April 7th this year. Implementation of the Regional Comprehensive Economic Partnership (RCEP), to which China and New Zealand are both parties, has yielded encouraging initial results. 

On top of that, China has applied to join the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) and the Digital Economy Partnership Agreement (DEPA). The applications represent a strategic choice made by China to benchmark the highest-standard trade agreements, which fully demonstrates China’s determination to further deepen domestic reforms and expand high-level opening up to the world. 

It is my firm belief that the accession by China to these cutting-edge arrangements will open up new frontiers not only for the welfare of respective members involved, including NZ,  but also for their cooperation with China on higher levels, contributing to greater innovation and sustainable development.

Without doubt, COVID remains a serious constraint on the world economy at this moment, and the Chinese economy is no exception. Since March this year, parts of China have experienced a rebound in Covid cases. Based on its own circumstances, China has adopted the two-pronged “dynamic zero-Covid policy”, integrating pandemic control and the protection of people’s lives on one hand, and securing economic and social development on the other.  

The approach has worked well, by keeping the pandemic in the country under control, and at the same time, maintaining the overall stability of the Chinese economy. Indeed, nothing can be done without a price. But we believe that the price tag is necessary and worthwhile, as it is much smaller than would be the case otherwise, particularly in the event the pandemic were allowed to run out of control. 

For this reason, China’s adherence to the “dynamic zero-Covid policy” is not only the responsible thing to do for the Chinese people. With the country being an important hub in the global supply chain, in the long run, it is also the responsible thing to do for the global economy and for our partners worldwide. Arguably, the greater the stability in China, the greater certainty there is for the world. With the implementation of measures to support businesses, increase effective investment and galvanize consumption, the economy will further stabilize and recover. Going forward, China will also keep optimizing and better targeting our Covid measures as the pandemic evolves, on the basis of the best science available, to support economic recovery and speed up the orderly resumption of cross-border travel, which, I suppose, is also welcome news for China-New Zealand engagements and cooperation.

Ladies and Gentlemen,

50 years ago, China and New Zealand followed the trends of then international politics and made the visionary decision to establish diplomatic relations. 14 years ago, the two countries went with the trends of the global economy and signed the bilateral Free Trade Agreement. These two decisions have paid off handsomely. Since 2008, China-New Zealand trade in goods has maintained an average annual growth rate of 17%, much higher than the 3% annual growth rate of New Zealand’s total export of goods during the same period. In that process, China has become New Zealand’s biggest trading partner and the biggest source of surplus.

Trade does not take place in a vacuum, though. While the exponential growth of bilateral trade constitutes arguably the staunchest of all pillars for China-NZ relationship, trade between us has no doubt benefited enormously from the healthy and stable development of the overall relationship. 

Very soon, we shall celebrate the 50th anniversary of our diplomatic relationship. Over those 50 years, China-New Zealand cooperation has created many “firsts”, leading the relations between China and Western developed countries. These rich assets have laid a solid foundation for the further development of the bilateral relations. Going down the road, the two sides should cherish the historical achievements, and seize opportunities to promote China-New Zealand relations to better benefit our two peoples in the next 50 years, giving increasing substance to the Comprehensive Strategic Partnership between the two countries.

To this end, I would suggest that both sides focus in our efforts on three key words:

The first of the trio is “commitment”, commitment to joining hands to steer the China-NZ relationship in the right direction. 

Although we have much to celebrate in our relations, there is no room for complacency. What we have achieved has not taken place as a matter of course, but rather as the result of painstaking efforts from both sides. By the same token, nothing in the future development of the relations can be taken for granted. It will depend on our joint efforts to make it happen. 

For China, developing a friendly relationship of cooperation with New Zealand is a long-term strategic decision, rather than a short-term choice of convenience. We shall not waver in our  commitment to the relationship no matter how the international situation evolves. As a matter of fact, as we see it, the greater the uncertainty in the international situation, the more determined countries like China and New Zealand should be to cooperate on the basis of mutual respect and mutual benefits, with a view to imparting greater certainty both to our respective development and to global and regional peace and prosperity. On our part, we stand ready to work unremittingly with New Zealand to that end.

Meanwhile, we have no intention of shying away from our differences or divergences with the New Zealand side. It is our firm belief, however, that what we have in common far outweigh our differences. So long as we adhere to the principles of mutual respect, seeking common ground while reserving differences, and non-interference in each other’s internal affairs, the two countries can , through constructive dialogues, properly manage, gradually reduce, and eventually transcend the differences between us.

The second key word is “consolidation”, namely, strengthening economic and trade cooperation for mutual benefit. The success of China-New Zealand economic and trade is no doubt a function of market forces, but it has also been blessed by the strategic guidance of the leaders of both countries and the broad-based support of the two peoples. 

 People in China perceive New Zealand as a friendly, open, inclusive, green and clean country. They have thus, with their feet and wallets, cast their votes of confidence, as tourists and students and as consumers, in the China-New Zealand relationship. This national branding buttressed by the trust of the people are a unique asset of our bilateral relations, and deserves to be carefully protected and nurtured by both sides. In this connection, the important role to be played by a responsible media in helping the people on both sides to see things as they are, through the veil or dust of mis-or-even-disinformation, cannot be overemphasized.  

As a Chinese proverb goes, “A boat going upstream will either sail ahead, or it will drift back”. With China being the largest trading partner of more than 120 countries, the Chinese market is one of the biggest, and yet one of the most competitive in the world. New Zealand companies have already established distinct advantages on the Chinese market. The two sides should as well work to entrench and extend that advantage, in the common interests of both countries, especially both peoples.

The third key word is “growth”, meaning the need to tap the full potentials of the relationship to make the pie of common interests bigger. As most of us will agree, China-New Zealand relations are way beyond the transactional. Looking ahead, the two countries should bring stronger resolve and a broader vision to bear in taking our cooperation to a higher level, beyond trade as such, and again, above our differences.

Taking existing cooperation as the baseline, the two sides could strengthen the alignment of priorities and on that basis, aim for breaking new ground in both the scope for and approach to our cooperation. Based on our endowments and comparative advantages, new and growth areas may include climate change, sustainable agriculture, public health and pandemic preparedness and response, bio-medicines, infrastructure development including BRI-related cooperation, and people-to-people exchanges. 

Let me underline, in particular, the importance we attach to the people-to-people links between the two countries, which can help our relations to take stronger and deeper roots. In this context, we look forward to seeing increasing tourists and students going both ways as borders reopen further.

Ladies and Gentlemen,

Beyond the strictly bilateral relationship, China and NZ have between us broad shared interest in, and common or similar positions on maintaining global and regional peace, stability and promoting common prosperity and global sustainable development. This creates immense space for cooperation between China and NZ and gives added value to our partnership in this rapidly changing world. 

In this regard, I would like to take this opportunity to emphasize the following points.

First, China is firmly committed to upholding multilateralism, the international system with the United Nations at its core, the international order based on international law, and the norms governing international relations based on the purposes and principles of UN Charter. China opposes unilateralism, hegemony, Cold War mentality, military alliances, the division of the world, along idealogical lines or otherwise, into exclusive or even opposing blocs or spheres of influence, and the coercion of other countries to take sides. 

Second, China and NZ both hold major stakes in preserving peace and stability in the Asia-Pacific as our common home. Tensions, let alone conflicts or wars are the last thing China wants to see in this region. China is committed to working with New Zealand and other partners to jointly safeguard  peace and stability and oppose any attempt and provocations to create tensions or stoke conflict in this region.

Third, China and NZ share major common interests in the South Pacific. Both want to see peace and stability in the region, and both want to support Pacific island developing countries in their efforts to address the existential challenge of climate change and pursue sustainable development.  China respects New Zealand’s traditional ties and influence in the region, and stands ready to work with NZ on that basis to help our island partners achieve common development.

In concluding, let me say, if the China-New Zealand relationship was still a narrow creek when it started off 50 years ago, now it has grown into a roaring torrent, just like the Mighty Waikato river, which I had the good fortune to visit not long ago. And like the Mighty Waikato, too, although there might be ups and downs, or twists and turns, our relationship will indomitably forge forward.  Of that I am confident as ambassador at this important juncture in our relationship. In that capacity, I shall go all out to work with friends from all walks of life in New Zealand, including the business community represented here today, to make the relationship work for both countries, particularly both peoples in the next 50 years and beyond, as I truly believe that such is the right thing to do, and that it is in our common interest to do so. 

Finally, thank you again for this opportunity to speak today, and I wish the China Business Summit a success !