Question: How do you see the impact of the South China Sea question on China-ASEAN relations?

Answer: On the question of the South China Sea, China and ASEAN countries have had many in-depth discussions and reached consensus. As long as we stay committed to this consensus and act in accordance with mutually-agreed principles, the South China Sea region will stay peaceful and stable.

The core of the South China Sea question is the disputes over the sovereignty of some islands and reefs of the Nansha Islands and the delimitation disputes over some waters in the South China Sea. It is a difficult question built over years, involving the bilateral differences between China and some ASEAN countries. The Chinese government is firmly committed to the path of peaceful development, and is unshakable in its resolve to uphold national sovereignty and territorial integrity. This is why China has persistently sought dialogue with relevant countries and ASEAN to explore effective ways for upholding regional stability. The Declaration on the Conduct of Parties in the South China Sea (DOC), signed among China and ASEAN countries in 2002 is a fundamental document for maintaining peace and stability in the South China Sea. The DOC has established a series of important principles, including: settling relevant disputes by peaceful means; pending the settlement of disputes, the parties concerned undertake to exercise restraint and refrain from carrying out activities that could complicate or escalate disputes; and conducting practical cooperation. These principles reflect the wisdom of Asian countries in handling complicated problems and represent the biggest common interests of all countries. These hard-won principles have provided indispensable conditions for the robust cooperation and economic prosperity in this region. The DOC should be observed and upheld in real earnest. China and ASEAN countries should stick to dialogue and cooperation and effectively safeguard peace and stability in the South China Sea.

China is always firm in upholding peace and security. This meets its own need of development and serves the interests of East Asia. We are deeply aware that without a secure environment, economic development and prosperity would be out of the question. The South China Sea is an important international shipping lane. As a big trading nation, China depends heavily on the unimpeded access and safety of international sea lanes, and also shoulders responsibilities in this regard. Therefore, China places high importance on the freedom of navigation in the South China Sea and cares deeply about ensuring the safety of navigation there. The truth is, the territorial disputes in the South China Sea have not affected the international shipping lane. China will continue to actively advocate and participate in regional maritime cooperation, including maritime security cooperation, and uphold peace and tranquility in this region.

Question: China's economic development has drawn high attention of other countries. Could you brief us on China's current economic situation and its impact on ASEAN and other East Asian countries?

Answer: World economic recovery now faces difficulties and there are also many uncertainties in the Asian economy. In the face of the complex international and domestic situation and downward economic pressure, the Chinese government has stood its ground and responded in a calm way. We have maintained stability in and innovated on our macroeconomic policies. On the one hand, we have refrained from expanding fiscal deficit, and neither eased nor tightened monetary policy. On the other hand, we have taken a series of creative policy measures to boost reform, energize the market, adjust the economic structure, and have seized every opportunity to transform and upgrade the economy. These measures are in line with the goal of maintaining steady growth and have effectively kept the economy on an even keel. In the first six months of this year, China's GDP grew by 7.6%, and employment rate and overall prices were both stable. Since July, major economic indicators have rebounded, the real economy has been dynamic and market confidence has increased. The Chinese economy now enjoys a strong momentum of steady growth.

China's development is closely linked to that of the world. Over the past 30 years, the Chinese economy has benefited a great deal from opening up. China's rapid growth has also contributed much to East Asia and the world. In the future, with parallel advancement of industrialization, IT application, a new type of urbanization and modern agriculture, China stands a good chance of sustained and sound growth, and will continue to release reform dividends, market potential and innovative vitality. It is projected that in the next five years, China's import will reach US$10 trillion, its outbound investment will top US$500 billion and its overseas visits will exceed 400 million. China hopes to share with ASEAN and other East Asian countries such tremendous business opportunities and make greater contribution to the development of ASEAN, other East Asian countries and the world. We hope other countries will all play an active part in this process and create greater conditions and a better environment for our cooperation.

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