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Foreign Ministry Spokesperson Hua Chunying's Remarks on the Report of the European Union Chamber of Commerce in China
2016/02/25

Q: The European Union Chamber of Commerce in China said in a report that China's overcapacity is wreaking far-reaching damage on the global economy and China's economic growth in particular. The Chamber President said that Beijing hopes to soak up overcapacity by selling its excess production to markets in Central Asia and the Middle East as part of the Belt and Road initiative. But those markets are not big enough to absorb China's overcapacity. What is China's comment on that?

A: I have not seen the whole report you mentioned, but I have some queries about the viewpoint that you quoted. Some Chinese industries do face the problem of overcapacity. However, it is just a phenomenon in the process of China's economic restructuring. The rationale is that after over 30 years of high speed growth, the Chinese economy has entered a new stage where its driving force is being converted and its structure readjusted. The Chinese economy is growing at medium and high speed compared with the previous high speed. That is in line with the economic laws and is also the result of the Chinese government's regulation. In recent years, the Chinese economy has contributed 50 per cent to world economic growth. Even in the last year when the Chinese economy was under increasing downward pressure due to the influence of external environment, China still created about 25 per cent of world economic growth with a GDP that accounted for around 14 per cent of the world's total, making more contributions to the global economy than it was supposed to. I wonder how the report you mentioned reached the conclusion that China "is wreaking far-reaching damage on the global economy". Once the restructuring is finished, the Chinese economy is sure to offer stronger boosts to the world economy.

We maintain that when we carry forward the Belt and Road initiative and conduct international cooperation on production capacity, we should make joint efforts with all relevant countries based on thorough communication so as to make the best of each other's advantages and achieve win-win results. We design each and every program through consultations with cooperative partners, taking into full account the actual needs of countries where the production capacity goes. Cooperation as such is not just about addition or reduction. The linking of industrial chain and supply chain through production capacity cooperation will unleash more new space and potential for growth. Because of that, some developed countries including EU countries have taken an active part in trilateral production capacity cooperation with China and other developing countries. I believe that we could combine Chinese manufacturing's advantages in cost and performance with developed countries' high-end technologies as well as developing countries' needs, in a bid to meet the interests of all and inject new impetus to the world economy.

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