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Nolongercanpeopletalkabouttheglobaleconomy
withoutincludingthecountrythathasgrownonaveragetenpercentayearforthreedecades.
Nolongercanwetalkabouttrade…
withoutthecountrythatisnowtheworld’slargestexporterandthirdlargestimporter
Andnolongercanwedebateenergysecurityorclimatechange
withoutthecountrythatisoneoftheworld’sbiggestconsumerofenergy.
Chinaisoncoursetoreclaim,laterthiscentury,itspositionastheworld’sbiggesteconomy
thepositionithasheldfor18ofthelast20centuries.
andanachievementofwhichtheChinesepeoplearejustlyproud.
Putsimply:
Chinahasre-emergedasagreatglobalpower.
ThreatorOpportunity
Nowpeoplecanreacttothisinoneoftwoways.
TheycanseeChina’sriseasathreat
ortheycanseeitasanopportunity.
TheycanprotecttheirmarketsfromChina
oropentheirmarketstoChina.
TheycantryandshutChinaout
orwelcomeChinain,toanewplaceatthetoptableofglobalaffairs.
TherehasbeenachangeofGovernmentinBritainandachangeofPrimeMinister.
ButonthisvitalpointthereisabsolutecontinuitybetweenmygovernmentandtheGovernmentsofTonyBlairandGordonBrown.
WewantastrongrelationshipwithChina.Strongontrade.Strongoninvestment.Strongondialogue.
ImadethatclearasLeaderoftheOppositionwhenIvisitedBeijingandChongqingthreeyearsago.
AndIrepeatitasPrimeMinisterhereinChina’scapitaltoday.
IntheargumentabouthowtoreacttotheriseofChina.
Isayit’sanopportunity.
Ichooseengagementnotdisengagement.
Dialoguenotstand-off.
Mutualbenefit,notzero-sumgame.
Partnershipnotprotectionism.
Britainisthecountrythatarguesmostpassionatelyforglobalisationandfreetrade.
FreetradeisinourDNA.
AndwewanttradewithChina.Asmuchofitaswecanget.
That’swhyIhavewithmeonthisvisitoneofthebiggestandmosthigh-powereddelegationsaBritishPrimeMinisterhaseverledtoChina.
JustthinkaboutsomeoftheprizesthattheriseofChinacouldhelptobringwithinourgrasp.
Strong,andsustainablegrowthfortheglobaleconomy.
VitalprogressontheDohatraderoundwhichcouldadd$170billiontotheglobaleconomy.
Arealchancetogetbackontracktowardsalegallybindingdealonemissions
Unprecedentedprogressintacklingpoverty.
Chinahaslifted500millionpeopleoutofpovertyinjustthirtyyears.
Althoughthereisstillalongwaytogo–that’smorepeopleliftedoutofpovertythanatanytimeinhumanhistory.
Youcanseetheresultsrightacrossthisenormouscountry.
WhenIworkedinHongKongbrieflyin1985,Shenzhenwasbarelymorethanasmalltown,surroundedbypaddyfieldsandwaterways.
TodayitisacitylargerthanLondon.Itmakesmostoftheworld’siPodsandoneintenofitsmobilephones.
Andthereareotherbenefitstoointacklingtheworld’smostintractableproblems.
Iwelcomethefact,forexample,thatmorethan900ChinesedoctorsnowworkinAfricancountriesandthatinUgandaitisaChinesepharmaceuticalfirmthatisintroducinganewanti-malarialdrug.
SoIwanttomakethepositivecase
fortheworldtoseeChina’sriseasanopportunitynotathreat.
ButChinaneedstohelpustomakethatargument
todemonstratethatasyoureconomygrows,sodooursharedinterests,andoursharedresponsibilities.
WeshareaninterestinChina’sintegrationintotheworldeconomy,whichisessentialforChina’sdevelopment.
IfwearetomaintainEurope’sopennesstoChina,wemustbeabletoshowthatChinaisopentoEurope.
Soweshareaninterestinaninternationalsystemgovernedbyrulesandnorms.
Weshareaninterestineffectivecooperativegovernance,includingfortheworldeconomy.
Weshareaninterestinfightingprotectionism
andinaco-ordinatedrebalancingbetweensurplusanddeficitcountries.
Theseinterests,thoseresponsibilitiesarebotheconomicandpolitical.
Letmetakeeachinturn.
EconomicResponsibilities
First,economicresponsibilities.
Let’sgetstraighttothepoint.
Theworldeconomyhasbeguntogrowagainafterthecrisis.
Butthatgrowthisveryuneven.
LedbyChina,Asiaandotheremergingmarketsaregrowingquickly.
Butinmuchoftheadvancedworldgrowthisslowandfragileandunemploymentstubbornlyhigh.
Weshouldnotbesurprisedatthis.
Thecrisishasdamagedmanyadvancedeconomiesandweakenedtheirfinancialsectors.
Theyfacemajorstructuralandfiscaladjustmentstorebalancetheireconomies.
Thisistrueofmyowncountry.
Weknowwhatstepsweneedtotaketorestorethepublicfinancesandrebalanceoureconomytowardsgreatersavingandinvestmentandgreaterexports.
Andwehavebeguntotakethem.
Butfortheworldeconomytobeabletogrowstronglyagain–andtogrowwithoutcreatingthedangerouseconomicandfinancialinstabilitiesthatledtothecrisis,weneedmorethanjustadjustmentintheadvancedworld.
Thetruthisthatsomecountrieswithcurrentaccountsurpluseshavebeensavingtoomuch
whileotherslikeminewithdeficitshavebeensavingtoolittle.
Andtheresulthasbeenadangeroustidalwaveofmoneygoingfromonesideoftheglobetotheother.
Weneedamorebalancedpatternofglobaldemandandsupply,amorebalancedpatternofglobalsavingandinvestment.
Nowsometimeswhenyouhearpeopletalkabouteconomicimbalances,itcanseemasthoughcountriesthataresuccessfulatexportingarebeingblamedfortheirsuccess.
That’sabsolutelynotthecase.
Weallshareaninterestandaresponsibilitytoco-operatetosecurestrongandbalancedglobalgrowth.
ThereisnogreaterillustrationofthisthanwhathappenedtoChinaasthewesternbankingsystemcollapsed.
Chineseexportsfell12percent
growthdroppedtoitslowestpointinmorethanadecade
andsome20millionjobswerelostintheChineseexportsector.
Changesinthestructureofoureconomieswilltaketime.
Whatisimportantisthatthemajoreconomiesoftheworldhaveasharedvisionofthepathofthischange:
whatactionscountriesshouldavoid;
whatactionscountriesneedtotakeand,crucially,overwhatperioditshouldhappen.
ThisiswhytheG20–andthemeetinginSeoul–issoimportant.
Togetherwecanagreeacommonapproach.
Wecancommittothenecessaryactions.
Wecanagreethatwewillholdeachothertoaccount.
AndjustasChinaplayedaleadingroleattheG20inhelpingtoavertaglobaldepression
soitcanleadnow.
IknowfrommydiscussionswithPremierWenhowcommittedChinaistoactionstorebalanceitseconomy.
Chinaisalreadytalkingaboutmovingtowardsincreaseddomesticconsumption
betterhealthcareandwelfare
moreconsumergoodsasitsmiddleclassgrows
andintimeintroducinggreatermarketflexibilityintoitsexchangerate.
Thiscannotbecompletedovernight
butitmusthappen.
Let’sbeclearabouttherisksifitdoesnot
aboutwhatisatstakeforChinaandfortheUK–countriesthatdependonanopenglobaleconomy.
Attheworstpointofthecrisis,weavertedprotectionism.
Butatatimeofslowgrowthandhighunemploymentinmanycountriesthosepressureswillriseagain
alreadyyoucanseethem.
Countrieswillincreasinglybetemptedtotrytomaximisetheirowngrowthandtheirownemployment,attheexpenseofothers.
Globalisation–theforcethathasbeensopowerfulindrivingdevelopmentandbringinghugenumbersintotheworldeconomycouldgointoreverse.
Ifwefollowthatpathwewillallloseout.
TheWestwouldloseforsure.ButsotoowouldChina.
Forthelasttwodecades,tradehasbeenaverypositivefactorinChina’sre-emergenceontheworldstage.
Ithasdrivenamazinggrowth
andraisedthelivingstandardsofmillions.
TradehashelpedstitchbackChina’snetworkofrelationswithcountriesacrosstheworld.
Weneedtomakesurethatitdoesnotturnintoanegativefactor.
JustastheWestwantsgreateraccesstoChinesemarkets
soChinawantsgreateraccesstoWesternmarkets
anditwantsmarketeconomystatusintheEUtoo.
IhadveryconstructivetalkswithPremierWenonexactlythisissueyesterday.
IwillmakethecaseforChinatogetmarketeconomystatusintheEU
butChinaneedstohelp,byshowingthatitiscommittedtobecomingmoreopen,asitbecomesmoreprosperous.
Andweneedtoworktogethertodomoretoprotectintellectualpropertyrights
becausethiswillgivemorebusinessesconfidencetocomeandinvestinChina.
UKcompaniesareuniquelyplacedtosupportChina’sdemandformorehighvaluegoodsforitsconsumers.
OurPavilionattheWorldExpoinShanghai–whichwontheGoldAwardforthebestPaviliondesign–wasashowcaseforsomanyofBritain’sstrengths
fromadvancedengineeringtoeducation…
fromgreatbrandstogreatpharmaceuticalbusinesses
fromlowcarbontofinancialservicestothecreativeindustries.
Inalltheseareasandmanymore,BritishcompaniesandBritishexportscanhelpChinadelivertheprosperityandprogressitseeks.
WecanbepartofChina’sdevelopmentstrategy,justasChi