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Elements of Remarks by H.E. Ambassador Lin Songtian at South African National Editors Forum (SANEF)
2018/08/22

I. State Visit by Chinese President Xi Jinping

On 23 to 27 July, the Chinese President Xi Jinping paid a very successful state visit to South Africa and attended the 10th BRICS Johannesburg Summit.

This is the third state visit to South Africa by President Xi Jinping, and South Africa is the only country in the world that the Chinese President has paid three state visits to. It is also worth mentioning that, despite his busy schedule of receiving over 20 heads of states or governments for the BRICS Summit, President Cyril Ramaphosa has spent the whole day on the 24 July to receive the state visit by President Xi. And very soon, President Ramaphosa will conduct his first state visit to China, and to co-chair the Forum on China-Africa Cooperation (FOCAC) Beijing Summit together with President Xi Jinping of China.

Such frequent exchanges between our two Presidents gives full expression of the importance, warmth, and high-levelness of China-South Africa comprehensive strategic partnership. It reflects that our two Presidents and two Governments view China-SA relations from strategic height and long-term perspective, that our relations serve the fundamental interests of our respective countries and people based on common values and shared interests, and is not affected by the change in government. This is why our relations have leapfrogged from partnership to strategic partnership to comprehensive strategic partnership.

During the state visit, the two Presidents held bilateral meeting and formal talk, attended signing ceremony and the press conference. And President Ramaphosa hosted a state banquet in celebration of the 20th anniversary of China-South Africa diplomatic ties. The two Presidents have reached a lot of important consensus on promoting China-SA comprehensive strategic partnership in a new era, and have agreed to enhance high-level exchange, deepen political mutual trust, synergize development strategies, promote practical cooperation, intensify people-to-people exchange, strengthen cooperation in multilateral fora, and jointly uphold multilateralism and oppose unilateralism and protectionism.

The two Presidents jointly attended the South Africa-China Science, Technology and Innovation Exhibition, and addressed the opening ceremony of the China-South Africa Scientists High Level Dialogue. The events featured some of the most important science and technology cooperation projects between China and South Africa, including the SKA (Square Kilometre Array) Radio Telescope. Both Presidents have expressed the importance of science and technology cooperation under the current circumstances of new technological and industrial revolution. President Xi Jinping has also expressed China's willingness to partner with South Africa to seize the opportunity to bring about leapfrog development across all developing countries.

During the visit, the two Presidents witnessed the first car rolling off production line at the new BAIC SA factory through video conference. The signing of this project was witnessed by President Xi Jinping during his previous state visit to South Africa in December 2015. President Xi Jinping expressed his sincere wishes for China and South Africa to strengthen practical cooperation for shared prosperity. President Ramaphosa expressed his hope that the South African made vehicles could be sold to markets across Africa. These events not only demonstrated the advanced level of China-South Africa cooperation, but also reflected the high efficiency and effectiveness of bilateral practical cooperation.

Both Presidents agreed to strengthen cooperation under the frameworks of the Belt and Road Initiative and the Forum on China-Africa Cooperation (FOCAC). The two Presidents agreed to deepen cooperation in new economies and emerging sectors, to share the development opportunities brought forth by the 4th industrial revolution, and to bring more benefits to the peoples of China and South Africa. During the visit, over 10 agreements have been signed, totaling 14.7 billion US dollars. During the visit, one of the most important agreement signed is a visa agreement, which will directly benefit people-to-people exchange. This agreement together with other agreements totaling 14.7 billion US dollars of investment commitment, is a testament to China's strong confidence in and support for South Africa and China-South Africa relations.

We are very happy to see that South African government officials, business leaders, think tanks, and media have viewed and commented on the state visit with great positivity. Many believe that the visit has further strengthened the strategic dimension of China-SA relations and laid down solid foundation for the future of China-SA ties. The visit by President Xi Jinping also offered a boost of confidence in the South African government under the leadership of President Cyril Ramaphosa, as China took concrete action to respond to President Ramaphosa's 100 billion dollar Investment Drive. At the end of the state visit, the market has responded favorably, and South African Rand appreciated by 2.7% in two days.

It is fair to say that China-SA relations have become a role model for China-Africa, South-South and emerging markets cooperation. Moving forward, China and South Africa will have much to contribute to the building of a closer China-Africa community of shared future, and to a new type of international relations featuring mutual respect, fairness and justice, and win-win cooperation.

II. BRICS Johannesburg Summit

Last month, South Africa successfully hosted the 10th BRICS Summit. The Chinese President Xi Jinping has attended the Summit. This is the second time that South Africa hosted the BRICS Summit. This is also an important Summit for the BRICS as it marks the opening of the second "Golden Decade" of BRICS cooperation. The Summit has adopted the BRICS Johannesburg Declaration. The BRICS Johannesburg Summit has been highly successful with four major achievements.

First, the Summit has drawn a new blueprint for future BRICS cooperation. During the Summit, after analyzing the new developments in scientific and technological innovation, industrial revolution, and digitalization, BRICS countries have unanimously agreed to seize the new opportunities for innovative and inclusive growth in the fourth industrial revolution. In this regard, one of the most important outcome of the BRICS Johannesburg Summit is the adoption of the initiative of the BRICS Partnership on the New Industrial Revolution put forward by China and South Africa, the purpose of which is to deepen cooperation in digitalization, industrialization, innovation, inclusive growth and investment, so as to speed up the transformation from old economic driving forces to new ones as well as economic transformation and upgrading. I am very happy to share with you that BRICS countries have already agreed to establish an Advisory Group next month to work for a plan on the implementation of this important initiative.

Second, new progress has been made in the strengthening of economic and trade mechanisms. BRICS have agreed to reconvene the Trade Promotion Working Group of the Contact Group on Economic and Trade Issues (CGETI), and have established new mechanisms on laws and technical standards, small and medium enterprises, and outcome implementation. This new progress and new mechanisms will make BRICS cooperation more systematic, institutionalized, and concrete. BRICS have adopted the Implementation Framework for Intellectual Property Rights Cooperation Mechanism, which will further strengthen cooperation in capacity building, information exchange, and network development. The endorsement of Framework for BRICS E-commerce Cooperation will enable capacity building and best practice sharing in narrowing the digital gap. The BRICS Trade in Services Cooperation Roadmap and the establishment of the BRICS Focal Points on Trade in Services will facilitate progress in the exchange of information on international trade in services between BRICS members. In addition, BRICS partners have also agreed to commission the review of the BRICS Joint Trade Study on increased value-added trade, to further release the trade potential of BRICS countries, and to enable BRICS countries to effectively move up in the global value chain. We are confident that all of these achievements will further reinforce the unity and cohesiveness of BRICS countries, and will inject new vigor into BRICS economic and trade cooperation in the new era.

Third, the Summit has sent a strong voice of fairness and justice to the world community. Against the backdrop of rising protectionism, unilateralism, and extreme individualism, BRICS countries have come together strongly to fight for the fair and just international order, and to uphold the rule-based multilateral trading regime. BRICS countries have reaffirmed their strong commitment to inclusiveness and win-win international cooperation, strong commitment to multilateralism and global governance, and strong commitment to the full compliance with the jointly-made international rules. The BRICS spirit of openness, inclusiveness and win-win cooperation has resonated strongly the common voice of the vast number of developing countries, charting for the world the correct course for economic globalization and multi-polarization.

Fourth, the Summit has improved the BRICS Plus mechanism and expanded the developing partnership network. During the Xiamen Summit, China pioneered the cooperation concept of BRICS Plus and held the first dialogue between emerging markets and developing countries. The BRICS Plus helped deepen mutually beneficial partnerships, tap into new development momentum, create a favorable external environment, and build a new type of international relations. The Johannesburg Summit continued this pattern and was warmly received by developing countries, especially among African countries. 21 countries including emerging markets and African countries took part in the BRICS Plus leaders' dialogue, further improving the BRICS Plus mechanism and expanding the BRICS "circle of friends".

Over the past months, some people have argued that South Africa did not benefit from BRICS. My response is: the decision made by the South African government to join the BRICS serves the fundamental interests of the country and the people of South Africa.

First, BRICS has significantly made South Africa stand high in the world. South Africa is the only member state of the BRICS from Africa. BRICS as emerging economies has become an important force in building a more fair, just and inclusive international governance system, giving South Africa a proud identity on the global stage.

Second, BRICS has brought tangible benefits to South Africa. As a main engine driving world economic growth, the combined population of BRICS countries accounts for 40% of world's total. The BRICS aggregate economy accounts for 23% of the global total, and has contributed to over 50% of world economic growth. From 2011 to 2016, South Africa's trade with other BRICS partners has increased by 54.7%. The BRICS New Development Bank African Regional Center is established in Johannesburg. Going forward, the BRICS countries will continue to complement each other, and it is very sure that South Africa will benefit from them even more.

Third, BRICS gives South Africa a high-profile stage to attract global attention. BRICS is no longer a grouping of five countries alone. Thanks to the BRICS+, BRICS has now become a champion for all developing and emerging countries. When BRICS gather, the whole world is watching. While hosting BRICS Johannesburg Summit, South Africa has received more than 20 heads of states and governments, and many more representatives from international institutions. BRICS Business Council draws business leaders from all over the world. For every 5 years, South Africa will host a new Summit. For South Africa, this is great opportunity, to showcase its development achievements, to attract global attention, and most importantly, to attract global investment.

III. FOCAC Beijing Summit

I'm an old friend of Africa, and have been to 38 countries on this continent. This is my third Ambassadorial posting in Africa. Previously, I was the Ambassador first to Liberia, then to Malawi. I have been the Director-General for African Affairs in the Chinese Foreign Ministry and the Secretary-General of the Chinese Follow-up Committee of the Forum on China-Africa Cooperation (FOCAC). I'm very happy to use this opportunity to share with you some of my ideas on FOCAC.

FOCAC was jointly established by China and African countries in 2000. Over the past 18 years, FOCAC has grown tremendously in terms of its mechanism building, practical cooperation, and achievements. Today, we are very proud to say that FOCAC has undoubtedly become the most leading, visible, influential, and high-achieving cooperation forum for development cooperation with Africa. It has become a flagship cooperation model for international cooperation with Africa. In my view, the success of FOCAC is attributable to three factors.

First, FOCAC has established comprehensive mechanism. The Forum enjoys a well-established mechanism of cooperation, including the Ministerial Conference, Senior Officials' Meeting, the Follow-Up Committee on Outcome Implementation, and the Secretariat. Especially with regard to the Follow-Up Committee, including China, over 40 FOCAC member countries have established their national follow-up committees. These institutional arrangements not only ensures the smooth operation of the Forum, but also guarantees that the Forum will not be a talk shop, but a place for action and implementation.

Second, FOCAC delivers tangible and visible results. China has never made empty promises. We always believe that, for the Forum to sustain and succeed, it must deliver and meet the urgent demands of the African people for durable peace and self-sustainable development. Self-sustainable development is extremely important for Africa, as we all know that if you are not independent economically, it is hard to be independent politically and eradicate poverty and conflicts.

To help Africa, we have identified three bottleneck issues: backward infrastructure, lack of professional and skilled personnel, and lack of capital sources. Who can help Africa resolve those problems, who is the true friend and reliable partner of Africa. In December 2015, during the FOCAC Johannesburg Summit, Chinese President Xi Jinping, together with African leaders opened up a new era of China-Africa win-win cooperation for common development. President Xi Jinping announced Ten Major Cooperative Plans together with 60 billion US dollars of financial support, with an aim to help Africa facilitate its industrialization and agricultural modernization.

After 18 years of FOCAC cooperation, China-Africa trade has increased from 10 billion dollars to over 170 billion dollars. Chinese investment in Africa has grown from less than 1 billion dollars to over 100 billion dollars. China has helped African countries finance and build 6,200 km of railways, 6,500 km of roads, 20 ports, 20 bridges, 80 plus power plants, over 200 schools, and more than 80 stadiums. In terms of capacity building, China is now providing over 10,000 government scholarships to African countries annually, and offers training opportunities for 200,000 person times in the course of 3 years, making a unique and important contribution to African countries' capacity building.

Third, FOCAC follows the principle and common values of equality and mutual trust, efficiency and pragmatic approach, and win-win cooperation for common development. All FOCAC members, regardless of their size, wealth, and population participate in FOCAC as equals. We all respect each other. No one is forced to do anything, everything is based on consensus, and nothing is achieved through bullying. Every three years, FOCAC makes a new action plan based on the conditions and development needs of member countries. Implementation of the action plan is carefully monitored and reviewed to ensure efficient and effective results. Under FOCAC, win-win cooperation for common development has become our common aspiration and objective. This idea was proposed by President Xi Jinping in 2015 during FOCAC Johannesburg Summit. The essence of it is to combine China's development with the self-sustainable development of African countries. China comes to Africa just to seek for partnership instead of ownership.

On 3-4 September, the Forum on China-Africa Cooperation (FOCAC) will hold a new Summit in Beijing. This will be the third FOCAC Summit. The second FOCAC Summit in Johannesburg was co-chaired by South Africa and China. Now the third FOCAC Summit in Beijing will be co-chaired by China and South Africa.

The new FOCAC Beijing Summit is convened under a very special international situation. Globally, we are witnessing a sharp rise of protectionism, unilateralism, and extreme individualism. The international governance system and the rule-based multilateral free trade regime is facing the gravest challenge and damage since the World War II.

Against such circumstances, it is only natural that the FOCAC Beijing Summit has attracted the attention of the leaders in Africa and beyond. African countries that have diplomatic ties with China have confirmed attendance by their head of state, head of government, or government representatives. The UN Secretary-General António Guterres and the AU Chairperson Moussa Faki have also confirmed attendance.

The theme of the FOCAC Beijing Summit is: "China and Africa: Towards An Even Stronger Community with A Shared Future through Win-Win Cooperation". The Summit will focus on connecting the ideas and development strategies between China and Africa, and to form a synergy among the Belt and Road Initiative, the UN 2030 Sustainable Development Goals, the AU 2063 Agenda, and the national development strategies of African countries.

Moving forward, it is envisaged that FOCAC cooperation will continue to address 3 bottleneck issues, develop 3 priority areas, achieve 4 priority objectives, and promote 5 networks in Africa. The 3 bottleneck issues are: infrastructure, professional and skilled personnel, and capital sources. The 3 priority areas are: investment, market access, and tourism. The 4 priority objectives: industrialization, agricultural modernization, digitalization, and urbanization. The 5 networks are: railways, highways, aviation, information, and electricity.

The FOCAC Summit in Beijing will adopt two outcome documents, namely the Beijing Declaration: Towards An Even Stronger China-Africa Community with A Shared Future and the Beijing Action Plan (2019-2021).

We have every reason to believe that, as our leaders gather in Beijing for another historic and successful FOCAC Summit, China-Africa cooperation will embrace a new era of win-win cooperation for common development, and will gather new strength and momentum towards an even stronger China-Africa community of shared future.

IV. Trade War

According to the findings of global financial and academic institutions, the trade war launched by the US government has caused huge negative impact on the global economy.

First, the trade war has significantly disrupted the world economic recovery. Research from Fitch, JP Morgan, and Oxford Economics shows that, the trade war will slow the 2019 world economic growth by 0.4%, equivalent to a loss of 350 billion US dollars. IMF forecasts that 2020 world economic growth will be reduced by 0.5%, a loss of 450 billion dollars. Standard & Poor's estimates that if all tariffs that the US is threatening come into force, the world economy will be down by 1%. Reuters calculates that for every 100 billion loss in global import, global trade will contract by 0.5%, and will cause a GDP decline of 0.1%.

Second, the trade war will cause harm to the economy of all countries, especially the emerging market countries. According to Fitch, in 2019, Chinese and US economy will respectively decline by 0.3% and 0.8%. In emerging markets, Mexican and Russian economy could decline by 1.7% and 0.6%, and Turkish, South African and Brazilian economy by 0.1%. The DBS Bank of Singapore estimates that the Southeast Asian economies that are highly exposed to the China-US supply chains will be worst heavily affected. Growth in Republic of Korea, Malaysia, Chinese Taiwan, and Singapore could be reduced by 0.4%, 0.6%, 0.6% and 0.8%. And that number could double in 2019. For the developed economies, IMF forecasts that growth could be affected by 0.2%-0.3% in 2018 for Britain, Germany, France, Italy, Japan and Australia.

Third, it has intensified global market volatility. The trade war has greatly undermined international financial market stability, and has caused tremendous volatility in foreign exchange and commodity price. The MSCI Emerging Market Index has declined by 8% from the April level, and the Emerging Market Index has declined by 18%. According to JP Morgan, Trump's trade policies has already cost the US stock market 1 trillion US dollars, equivalent to ⅔ of his stimulus package. In July, the Brent Crude Oil declined by 6.9%, the biggest decline since Feb 2016. Nickel, copper, zinc prices declined by 3%, 3%, and 6% respectively in the London Metal Exchange. This month, after the US announced tariff against Turkish steel and aluminum, Turk Lira plunges by 17%. And the negative impact has been felt across the emerging markets. Russian Ruble declined by 1.4%, South African Rand by 9.4% and Mexican Peso by 2.3%. European banks with major exposure to Turkish assets have also suffered stock price decline by 3%-5%, triggering new worries for the European debt problems.

Fourth, the trade war has severely undermined market confidence. IMF, JP Morgan, HSBC have all expressed concern that policy uncertainty undermines trust among trading partners and will hurt consumer as well as business confidence. Survey shows that US consumer confidence and the eurozone economic confidence index are at the all year low. Japanese major manufacturer index has worsened for two consecutive quarters. Because of the trade war, the global free trade regime that we have so painstakingly established since the World War II is now under serious challenge.

In essence, what the US is trying to achieve is not only "American First", but "American Only". To achieve that, the US is willing to sacrifice the free and fair multilateral trading system, sacrifice the rule based world order, and sacrifice the collective shared interests of the international community. The US is not only forcing China, but also the whole world, especially the emerging markets, to pay for its own problems. This is complete unilateralism, protectionism, and extreme individualism. The peoples of the whole world are paying for the US unilateralism and trade protectionism. Even the American people are paying higher prices because of the tariff increase. The US is making itself the enemy of the whole world.

China strongly believes that the law of the jungle where the strong bullies the weak, is long over. Moving forward, the international community, especially the emerging market economies must stand up together to say no loudly to any bullying policy against the rule-based free trade regime, to uphold world fairness and justice, and to fight for the integrity of the global trading system, for a fair and just international order, and for our shared interest and aspiration for common prosperity.

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