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Remarks by Ambassador Xiao Qian at Annual Iftar with Indonesian Think Tanks and Media

Dear friends from the media and think tanks,

Selamat sore!

Ramadan is a time for Muslims worldwide to commit themselves to spiritual renewal. It is also a time when Muslims celebrate joy and love between friends and families. Today, we are delighted to have invited so many friends from media and think tanks to break fast together. I hope through this event we will build deeper understanding and friendship. At the begining, I would like to thank you all for your continuing support of our embassy. Also I wish to convey the warm greetings and best wishes from 23 million Chinese Muslims to their Muslim brothers and sisters in Indonesia.

I. China-Indonesia Relations

In recent years, under the leadership of Chinese President Xi Jinping and Indonesian President Joko Widodo, our bilateral relationship has expanded in depth and breadth with fruitful results and embarked on the fast track of development.

First is frequent high-level exchanges. Until now, our Presidents have met for seven times and reached important consensus on building stronger relations and promoting synergy between development strategies. Following the announcement by General Elections Commission (KPU) on 21 May, Chinese President Xi Jinping and Vice President Wang Qishan sent congratulatory messages respectively to President Jokowi and Vice President-elect Ma’ruf Amin. Recently, Vice President Jusuf Kalla attended the 2nd Belt and Road Forum for International Cooperation in Beijing and held bilateral meetings with President Xi and Vice President Wang.

Second is growing synergy between development strategies. Our two countries officially signed the MoU on jointly promoting cooperation under the framework of Belt and Road Initiative and Global Maritime Fulcrum in 2018, which completed the top-level design for aligning development strategies. The Jakarta-Bandung High-speed Rail, which is the signature project of phase-one strategy alignment, has entered full implementation. Most recently, the breakthrough of Walini tunnel marked yet another significant progress in high-speed rail project, paving the way for acceleration of full construction.

Furthermore, we have began cooperation on Regional Comprehensive Economic Corridors, which is the signiture project of phase-two strategy alignment. Early this year, the 1st Joint Steering Committee’s Meeting was successfully held and reached positive consensus. During Vice President Jusuf Kalla’s visit to China in May, our two sides signed cooperation plan on construction of the Corridors. Substantial negotiation on a number of projects under the framework are well underway.

Third is steady progress in bilateral practical cooperation. In 2018, China-Indonesia bilateral trade reached 77.4 billion U.S. dollars, maintaining China’s status as Indonesia’s largest trading partner for 8 consecutive years. Chinese Mainland remained as Indonesia’s third largest investor, three years in a row by investing 2.4 billion U.S. dollars in 2018. In fact, if we take into account Chinese investment through entities in Hong Kong and Singapore, China is already the de facto No. 1 investor for Indonesia. Last year, China increased import of Indonesian palm oil by 590,000 tons, exceeding the target announced by Premier Li Keqiang when he visited Indonesia in 2018. In the first two months of 2019, China imported 790,000 tons of Indonesian palm oil, an year-on-year increase of around 200,000 tons. Moreover, our two countries signed protocols on export of Indonesian mangosteen and dragon fruit to China this year. In future, more Indonesian premium and specialty products will enter China, which will be conducive to balanced development of bilateral trade.

Fourth is a new chapter in people-to-people and cultural exchanges. In 2018, the number of Chinese tourists visiting Indonesia reached a new level, exceeding 2.1 million. At present, there are more than 15,000 Indonesian students studying in China, making it one of the favorite overseas education destinations for Indonesian students. Not long ago, Tsinghua University signed cooperation MoU with Bandung Institute of Technology on fostering innovative talents in Indonesia through institutional cooperation and human resources development. In addition, bilateral exchanges and cooperation in the fields of media, think tanks, youth, religion, science and technology, sports and others have yielded fruitful results.

Indonesia’s national development is faced with new opportunities following the recent re-election of President Joko Widodo. Next year marks the 70th anniversary of China-Indonesia diplomatic ties, a significant milestone as we carry forward our relations and forge ahead into the future. We are ready to take this opportunity to further enhance and upgrade our comprehensive strategic partnership.

First, to deepen political mutual trust. Joint efforts shall be made to maintian the momentum of high-level engagements and promote dialogues at all levels so as to provide political guidance and policy support for sustained development of our bilateral ties.

Second, to further promote synergy between the Belt and Road Initiative and Global Maritime Fulcrum Vision. Both sides shall work together to speed up and complete the construction of Jakarta-Bandung High-speed Rail on-schedule while creating a high-speed rail economic corrider. We need to strive for substantial progress in building the Regional Comprehensive Economic Corridors to support the development of Indonesia’s outer islands. Meanwhile, we shall actively explore possible cooperation in the field of production capacity and industrialization so as to add more highlights to existing cooperation.

Third, to intensify people-to-people and cultural exchanges. Both sides shall work to promote exchanges and cooperation in tourism, education, academia, media, youth, religion and sub-national regions, so as to consolidate public support for bilateral relations.

Fourth, to enhance coordination under such multilateral frameworks as the United Nations, WTO and G20. Jointly, we will uphold the common interests of both countries as well as the rest of the developing world and contribute to the peace and development in our region and beyond.

II. Trade friction between China and the U.S.

In recent months, the trade talk between China and the U.S. has been a heated topic in Indonesian media and think tanks. Many friends in Indonesia worry that the escalating trade friction will bring negative impact on the world economy, including the Indonesian economy. I want to use this opportunity to clarify our positions.

Firstly, the trade friction was initiated by the U.S. side.

In April last year, the U.S. side first announced additional tariff on Chinese exports to the U.S. China responded immediately. Ever since then, the U.S. side has continuously threatened China and imposed several rounds of additional tariff during China-U.S. economic and trade consultations. In early May this year, the U.S. side imposed an additional 25% tariffs on 200 billion US dollars of Chinese products, and threatened to impose tariffs on around 300 billion US dollars of Chinese products, on the ground that China’s backtracked position led to setbacks of the consultations, which was a wrongful accusation. The Chinese side has taken resolute countermeasures and carried out legitimate counterattack against the unreasonable acts of the U.S. side. This is to defend our legitimate rights and interests, as well as to maintain multilateralism and the free trade regime.

The recent escalation of trade friction is also caused by the reckless trade unilateralism and bullying by the U.S. side, who threatened China with extreme pressure, asked for sky-high prices and went back on their own words during the trade talks. The U.S. accused China of backtracking in trade talks. But if you look at previous media coverage on the past 11 rounds of trade talks, you will see clearly which side has been flip-flopping all along. In May last year, China and the U.S. reached consensus on trade and issued a joint statement in Washington, D.C. But just a few days later, the U.S. side abandoned the consensus. In December last year, the two sides reached consensus on the value of China’s purchases from the U.S., but in the following talks the U.S. side wantonly rejected the agreement and asked for more. It is not China but the U.S. who is backtracking and breaking commitments.

Secondly, China is firmly committed to safeguarding its legitimate interests.

China gives high priority to resolving problems and disputes arising from the China-U.S. economic and trade relationship. Despite the U.S. tariff threat, China, in the spirit of cooperation and taking responsibility, has conducted 11 rounds of economic and trade consultations with the U.S., which has best demonstrated China's sincerity and goodwill in moving forward the negotiations. China and the U.S. enjoy broad shared interests and areas for cooperation. China is committed to resolving disputes through dialogue and consultation, and hopes to reach a win-win agreement based on mutual respect. The sound and steady development of China-U.S. economic and trade relations is not only in the fundamental interests of the two peoples, but also the common expectation of the international community. Imposing tariffs will not solve any problem, and by starting a trade war, the U.S. will do as much damage to itself as it will do to others.

Facing the extreme pressure from the U.S. government and the arbitrary use of additional tariff, China’s stance has been clear: We are willing to talk, but ready to fight. There will be no winner in the trade war. China doesn’t want a war. But we are not afraid of it. Under certain circumstances, we have no choice but to fight.

China has the resolve and the capability to fight for its legitimate and rightful interest. Currently, the fundamentals of China’s economy are good. We have a comprehensive industrial system and a massive domestic market. We have enough policy tools in reserve, and we are prepared to face up to the challenges.

However, the Chinese side still hopes that the U.S. side could change course and return to the right track, which is negotiation and consultation. We hope that the U.S. side can make efforts as well towards the same direction with the Chinese side, and make progress in the negotiation on the basis of mutual respect, equality and honesty, so as to make an agreement that benefit both sides possible.

Thirdly, China will stay committed to reform and opening-up, and firmly uphold free trade principles and the multilateral trade regime.

The friction between China and the U.S. seems to be about trade, yet in nature, it is a clash of two beliefs. One is about openness and connectivity, while the other is about inward-looking and protectionism. The Chinese side has always believed that instead of fixing problems in international trade, unilateralism and protectionism will only create even more problems. Globalization is the trend of our time. Nobody can stop or reverse it. Members of the international community should work together to make bigger pies through cooperation and share the benefit of global trade through friendly consultation.

Last year we celebrated the 40th anniversary of China’s reform and opening-up. In the past 40 years, reform and opening-up delivered remarkable achievements for China’s economy. In the future, China still needs reform and opening-up to promote high-quality growth. During the second Belt and Road Forum for International Cooperation not long ago, President Xi Jinping again announced five major measures to promote further and high-quality opening-up. China will give greater market access to foreign capital, increase import in goods and services and give priority to policy implementation regarding opening-up. China will work with members of the international community, including Indonesia, to uphold multilateral trade rules and regime, and steer the global trade order back to a good track as soon as possible.

Last but not lease, I want to send you my best wishes during the holy month of Ramadan. I hope you all good health and a happy Idul Fitri.

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