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Special Edition 1996

A new Chapter in Chinese/Latin American-Caribbean Cooperation

Li Peng
 Primer Minister of the State Council of the People's Republic of China

    «Together Let Us Write a New Chapter for the Annals of Friendly China/Latin America and Caribbean Cooperation». Address made by Li Pen on November 14, 1996 at the Headquarters of the Latin American Economic System (SELA) in Caracas.

    I am pleased to be here among friends, by invitation of SELA, one of the oldest economic-integration organizations of the Latin American region, which has worked persistently for over 20 years to stimulate regional cooperation and improve the economies of the countries of the hemisphere. We greatly appreciate its work.

    I wish to take this opporunity to inform you of China's development in recent years and our beliefs concerning the promotion of cooperation ties between China and Latin America and the Caribbean.

    China, a country with great history, suffered colonial aggression and exploitation for over a century, from the mid-19th century to the mid-20th century, leaving a depressed economy and its people struggling amidst misery. Following the Foundation of the People's Republic of China in 1949, this ancient country took on a new path of independent and self-defined development, giving it a bright new outlook. In the late 1970s, in line with the theory of Deng Xiaoping concerning the formation of a socialist society maintaining Chinese traits, the country took another path to a stage of reform and opening. In recent years, the Chinese economy has kept up the pace of accelerated development, translating into a yearly average GDP growth rate of more than 9%, a noticeable improvement in living conditions and a hike in national economic potential. Cooperation and trade between China and the rest of the world has grown. This has amounted to a mean annual rhythm of growth of its imports and exports of more than 16%. In 1995, total volume of both was more than US$ 280 billion. The trade balance does not change significantly and the state foreign currency reserves are in the vicinity of US$ 100 billion. The enormous economic potential, the promising market horizons and the open investment environment has attracted numerous foreign businessmen to China to make direct investments. Such investments, already accounting for more than US$ 160 billion, have a positive influence on China's modernization. China is currently a place of political stability, economic bonanza, ethnic cohesion and social progress. The Chinese people live and work in a peaceful environment, and have faith in the future. Anyone free of prejudice, anywhere on the planet, can see a China that is safely striding towards an economy of a socialist market and the building of the social democratic policy.

    Early this year, the Chinese State finished tracing its development goals until the turn of the century and the fifteen years into the next. According to these goals, China's GDP is expected to have an 8% average annual growth rate during the last years of this century. In other words, towards the year 2000, our per capita GDP will increase threefold in respect of 1980, and will be mainly provided by a socialist market economic structure. Our national economy will continue at an accelerated pace during the first ten years of the next century, setting a solid base for the fundamental materialization of such modernization. In view of the dynamism of the current Chinese economic development, these goals are attainable.

    In applying the process of modernization throughout, China is not only concerned about the development of civilization in its materials dimensions, but also grants importance to the development of the spiritual dimension. These two aspects, both an overwhelming product of the progress of human society, complement and promote each other. We are actively working towards two different transformations, namely, the transformation of the planned-economy system into a socialist marketplace economy, and the transformation of the modality of extensive economic growth into a modality of intensive economic growth; and applying two strategies, the boosting of the country through science and education, emphasizing the beautiful traditions of the Chinese nation without undermining the assimilation of all the positive contributions of human civilization, fostering science, culture and education and of sustainable development, undertaking to obtain harmonious socioeconomic development and global social progress. We are willing and able to make China a more prosperous, democratic and civilized modern country through several decades of hard work.

    The general trend gleaned from the current international situation is one of détente. The world is nonetheless filled with contradictions and the existence and development of man must still face hard challenges. Preservation of world peace, intensification of friendly cooperation and promotion of shared development are common goals of these times and of all mankind. China, obliged by its external peace and independence policy, has become a heavyweight defender of world peace. The Chinese people are ready to join the rest of the world in an effort to reach the 21st century living in a peaceful, safe and prosperous new world.

    With their vast geographic dimensions and wealth of natural resources, the Latin American and Caribbean countries are among the regions with the greatest potential and most promising outlook on the planet. In recent years, the region has seen political stability, sound economic growth, the strengthening of unity and cooperation, a speedy process of economic integration and the constant raising of its international status. We are truly pleased by your accomplishments and wish you further success in the years ahead.

    China and the countries of this hemisphere, interlinked with one another by friendly exchanges during many years, have many similarities being developing countries. Thanks to their joint efforts, cooperation among these countries grows day by day. To date, China has established diplomatic relations with 17 countries in this region and keeps close political ties with them. Chinese leaders have made visits here, just as many of your State leaders have traveled to China. It is important to improve mutual understanding, build friendships, and boost cooperation. We have witnessed increasing growth of our economic and commercial cooperation. In 1995, the volume of trade exceeded US$ 6 billion, twice the amount of the late 1980s. Over the last few years, we have been witness to the progress-encouraging boost of investments and [Chinese-foreign] joint ventures or corporations with solely Chinese capital in 24 countries and territories of this region, where the Chinese government has provided economic aid according to its possibilities to more than 20 states, with no political strings attached. China and the Latin American and Caribbean countries, by joining together and cooperating closely with one another, have greatly contributed to the formation of a new type of south-south cooperation ties, to the improvement and advances in north-south relations, the raising of the position and role of developing nations and the establishment of a new world political and economic order that is peaceful, stable, fair and rational.

    China attributes great importance to fostering ties with the nations of Latin America and the Caribbean. I would like to take this opportunity to present the principles my country applies in this respect: directing interstate political dialogue to improve mutual knowledge and trust, develop economic and technical cooperation in several modalities to promote shared development, foster contacts at the private level to enhance the spheres of exchange and cooperation, support one another in the international arena in protection of the interests of developing nations, and create normal interstate relations with countries that still have none with China, adhering to the five principles of peaceful coexistence. The Chinese government, subject to the aforementioned principles, is set to conduct joint efforts with all Latin American and Caribbean countries, in order to create enduring, friendly and stable ties, under equal conditions and mutual benefits, thus writing a new chapter for the annals of friendly Chinese/Latin American and Caribbean cooperation.

    China is greatly interested in the rapprochement of economic and commercial cooperation with the countries of Latin America and the Caribbean. To boost our cooperation to unseen levels, we propose to center our attention on the following four aspects as key points:

    1. Active rapprochement of commercial ties. The level of trade between the parties is currently far from high, there being a limited variety of commodities representing an insignificant proportion of the respective national external trade. In light of the economic capacity of both parties and of how they complement each other, there is great potential to expand our trade. China offers light-industry, electromechanical and transportation equipment, farming machinery and construction euipment, all quality-made and competitively priced, ideal to suit the demands of the Latin American and Caribbean countries. Furthermore, my country has acquired greater knowledge of the products of this region and sees its imports from this region constantly increasing both in variety and volume. China has already established a trade center in Panama and plans to establish similar institutions in other countries of the region to facilitate trade flows between both parties.

    2. Foster cooperation between companies. The business sectors of China and Latin America and the Caribbean share a common interest in the development of economic-commercial collaboration in several modalities, and have obtained some experience in this sense. The companies of both sides can carry out significant tasks in areas such as construction contracting, cooperation in labor services, establishment of companies in modalities such as joint ventures or exclusive capital, cooperation in large-scale construction projects and related activities for third parties. The Chinese market is enormous and offers an increasingly better investment environment. We welcome businessmen of this side of the world to travel there to learn about it and invest.

    3. Examine the joint venture modality as a form of exploitation and development of natural resources. China and the Latin American and Caribbean countries have an abundance of natural resources and thus are in condition to trade and complement one another in this matter. The first steps have been taken for the joint exploitation of oil and iron ore between China and some Latin American countries. These step, in some cases, have had substantial results. For instance, as a result of my visit, another Orimulsion purchase agreement was entered into by China and Venezuela, this time involving 120 thousand tons of the product. This type of import promises to increase over the years. Consequently, oil companies of both have signed a letter of intent for the joint exploitation of the 5 million tons of the substance. China's steel industry firms and Brazil's iron-ore mining companies signed a memorandum promoting the joint exploitation of 5 to 6 million tons of said mineral. Likewise, the Chinese National Corporation of Non-Ferrous Metals contacted corresponding Chilean companies, as part of the framework of their plan to invest in copper exploitation in Chile. China is also interested in cooperating with Latin American countries in the areas of forestry, paper manufacturing and food production, among others. We are certain that these Chinese - Latin American joint ventures for the exploitation and use of natural resources entail great development perspectives.

    4. Strengthen scientific-technical exchange. Scientific-technical cooperation is an increasingly important aspect of economic cooperation. Enhancement of Chinese - Latin American collaboration in this sense helps strengthen the economic capacity of both in the search for shared growth amidst increasingly fierce international competition. Cooperation between the two parties in the field of high-technology has provided stimulating results, such as the important advances achieved in research and manufacturing by China and Brazil in the geological resources satellite and the conclusion of the Scientific and Space Technology Cooperation Agreement between China and Chile. Since China and the Latin American countries have a similar level of technological development, their cooperation in farming technology and other applied technologies show ample possibilities.

    SELA has always attributed importance to its relations with China and has promoted the vigorous development of the economic-commercial cooperation between its region and my country, which we appreciate and applaud and at the same express our certainty that this agency will make new contributions to the development of said cooperation.

    Being a Latin American country of great importance, with the steady economic development and increasingly better living conditions of its people of recent years, Venezuela has a very positive role in the regional agenda. We are pleased to see that, in the 22 years that have lapsed since the establshment of its diplomatic relations, the ties between China and Venezuela have seen constant and opportune improvement. I hope that, with the joint efforts of both parties, these ties will grow even more in all domains.

    As part of my current Latin American visit, I have sustained cordial, candid and promising conversations with the Venezuelan President Rafael Caldera, Chilean President Eduardo Frei and Brazilian President Fernando Henrique Cardoso. We spoke of bilateral, regional and international issues and agreed on many things. The Chinese Government and each of the Governments of the aforementioned countries signed several economic and technical cooperation agreements. Also, documents of the same type were signed with the business sectors, a true sign of the desire of both parties to assure their collaboration. Another thing, everywhere we have been we have been given a warm reception and neighborly attention by the corresponding Governments and people, charming us with the affectionate feeling of cordiality that the Latin American people has towards the Chinese. Chinese - Latin American and Caribbean cooperation rests on a firm base, covers a variety of fields, has enormous potential and reflects a bright future. Let us, hand in hand and with a firm grip on reality, and a vision of the future, dedicate our efforts to obtaining greater profit from this cooperation.

    Thank you

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