(October 8, 2016)

Distinguished guests, Ladies & Gentlemen,

Good afternoon!

I'm so delighted to visit the Humphrey School of Public Affairs, University of Minnesota. It's my honor to have the opportunity to share with you my thoughts and views on China-US relations and China’s foreign policy.

About one month ago, G20 Summit was held in City of Hangzhou, China. Hangzhou City is a little bit special in the history of China-US relations, because four decades ago the city witnessed signing of the Shanghai Communique, first ever in the history of bilateral relations. The Shanghai Communique symbolized an end to over 20 years of confrontation and charted the course for the normalization of diplomatic relations between the two countries.

The past predicts the future. History tells us where the two countries will go. The last 40 years have shown that China and the US should continue to cooperate to build the partnership, or what we often refer to as building a new model of major country relationship.

Now where the Sino-US relations should be headed 40 years later?

A reflection on the past should let us know what we do in the future.

In 1979, China and the United States agreed to establish diplomatic relations, a historic event of the greatest strategic significance for international relations in the latter half of the 20th century. It had not only opened up a new page in the history of China-US relations, but also carried far-reaching impact on the evolving international arena.

Thanks to joint efforts of successive leaders and the people of both countries, China-US relations have weathered through twists and turns and made unprecedented progress.

In 1979 the annual bilateral trade volume between us was only $2.45 billion, and surged to $560 billion in 2015. two-way investment, which was insignificant in the early days, exceeded $150 billion. From January to July, 2016, Chinese investment in the US grows at a rate of 210%, the US investment in China also grows 130%. Now China and the US are economically integrated with each other. According to IMF data, from 2010 to 2015 China and the US contribute an average of 67% to global economic growth combined, with a record high of 111% in 2012.

Before 1979 the official exchanges between the two countries were very much limited. But only in the past 3 years, from Sunnyland, California to Yingtai of Zhongnanhai Compound, from White House to the West Lake of Hangzhou, the frequent summit meetings between our two presidents have pushed forward the new model of major country relations. There are over 90 dialogue mechanisms in place between us, including the Strategic and Economic Dialogues (SED) and the Cultural and People-to-people Exchange (CPE) consultations. Moreover, there are more than 40 pairs of sister provinces/states and more than 200 pairs of sister cities between two countries.

In 1979, only a few thousand people visited each other. In 2015, the number was close to five million. Chinese visitors to the US reached 2.6 million, growing at a fast pace. Chinese students in US colleges and universities reached over 300,000. Now over 10,000 Chinese and Americans fly over the Pacific every day. And it is hard to estimate how many more people are interacting through the Internet and mobile phones.

In 1979, cooperation between China and the United States was nothing like what we have today in terms of scope and intensity. On global challenges such as the economic growth, climate change, energy security, food security, global epidemic and anti-terrorism as well as regional hot issues such as the Korean nuclear issue, the Iranian nuclear issue, Afghanistan and Syria issues, the two countries maintain close consultation and dialogue and play an important role in addressing these challenges and crises.

37 years ago, the top leaders of China and the US made strategic choices to establish diplomatic relations for the common interests of the two countries. History has proved that their decisions are wise and far-sighted.37 years have passed, and China and the United States have moved away from a state of no contact and become a community of intertwined interests. The strategic and global impact and significance of China-US relations have become increasingly prominent. President Xi Jinping and President Obama have agreed to forge a new type of major country relationship between China and US with no conflict, no confrontation, mutual trust and win-win cooperation as the main principle . It is in the trend of our time and the trend of the history.

Now the Sino-US relations have built a solid foundation, projected for new development. We need to tackle a few important issues.

Number one, we need to enhance strategic trust.

Some friends in the States are worried. They view China as the real and the major adversary of the United States, and that one day China will replace the U.S. In fact, such a kind of argument has behind it strategic mistrust and strategic suspicion in the long term. And if such a strategic mistrust develops, then it will make us concerned that small problems will grow into big ones. And even if there are no problems, someone will try to pick some. On the contrary if we can establish strategic mutual trust and remove misunderstanding and strengthen strategic cooperation, then we can overcome problems and find mutually acceptable solutions through consultation and discussions.

Would China become US principal adversary someday, or even replace the U.S.? The Answer is No.

First of all, although China is the world’s second-biggest economy, yet in per capita terms we rank in the eightieth in the world. People’s development is the basis for national development. And that’s why we say that we remain to be a developing country with a daunting task of alleviating 70 million people out of poverty. China’s overall level of development, the quality in particular, will lag behind the US for a long time. We are sober-minded on this. Therefore we would focus on our internal development so as to improve people’s welfare and help them live a dignified life. This is a long term task. We would strive to build governance capability, promote economic restructuring so as to maintain a medium high growth momentum. We also would enhance social security and promote ecological balance in order to ensure China's sustainability and prosperity and contribute to the global development.

We're not going to confront anybody, nor do we have any intention to replace any country. The American friends should not overestimate China's development level or come up with some forecast unfit to China’s reality. In fact if China does not run well, it would affect the US and the world at large. So I hope that American friends can understand it and support China’s growth, which is good for China and good for the US in the end.

Secondly, China and the United States have entered into an era of interdependence, and nobody can live without the other. Both China and the US are big in terms of trade, investment and people-to-people exchange. If conflict happens to us, both of us will lose given our high degree of integration. Therefore, only cooperation can lead to win-win results. We should no longer be trapped in a zero-sum game. China and the United States have a high degree of complementarities. We should continue to tap potentials of bilateral cooperation. China has established a “Four-Pronged Comprehensive Strategy” (namely comprehensive moves to build a moderately prosperous society, deepen reform, advance the law-based governance and strengthen Party self-discipline.) China, a country which constantly advances reform, opens up to the outside, and improves the rule of law and the market, will create tremendous opportunities for cooperation with rest of the world, including the US.

Thirdly, in the blood and the veins of China, there is no gene of expansionism. There is no mentality or urge for the Chinese to be saviors of the world. 2,000 years ago, we built the Great Wall of China for self-defense. That is the special characteristic and the very typical expression of the Chinese culture. And such a feature, ingrained in the blood or the genes of China, will continue to exist. one day in the future, China would become stronger and more developed, and maybe one day very far away from now given China’s huge population of 1.3 billion, the aggregate economy of China will become the world’s biggest by some people’s projection or estimates. But even if that day should come, China will still not be the United States. China will develop in the Chinese way with the mindset and the thinking of the Orient, and take an even more harmonious and inclusive attitude to deal with other countries and to play our due role in international relations. Cooperation between China and the U.S. will grow deeper and closer. In my view, what’s most needed now is the mutual understanding of each other.

Some Americans are worried that if China gets stronger, does it intend to change the current international order? The answer is no.

In the 2nd World War, with a price of 35 million Chinese people’s lives, China joined hands with others in fighting against fascists. The world peace didn’t come easily. China is a founding member of the United Nations and a permanent member of the UN Security Council. We had worked very hard for 22 years before we restored the legitimate seat in the United Nations with the support and help of the developing countries. We had also spent 15 years negotiating before we became member of the World Trade Organization. China has joined almost all intergovernmental international organizations and signed more than 400 international multilateral treaties. More and more Chinese assume positions in international institutions. China has become one of the most important players and supporters of the international system. We have no reason to challenge the international order, which is based on victory over fascism, nor do we have the motive to overthrow the international system which we are fully committed to build.

Meanwhile the international system needs to keep pace with the times and needs to reform in order to better reflect the general trend of the world. Such a system should appeal to the aspirations of the developing countries and be well positioned to cope with all kinds of new challenges. China is willing to work with all countries so as to build up a more equitable and just international system.

We are fully aware what kind of impact we might have and what kind of responsibility we should carry to the rest of world when we grow big in size and weight. So we would try to keep a balance regarding our impact and responsibility by proactively adapting to the rapidly-changing China and the world, so that China's peaceful development can always be a positive force in the world.

Recently, some American friends are very much concerned about the South China Sea issue, especially the so-called South China Sea arbitration case, with a suspicion that China’s denial of arbitration might constitute a violation of international law.

Nansha Islands are China's integral territory. We has comprehensive historical and legal evidence and records on that. Actions to safeguard our territorial integrity and sovereignty and prevent the legitimate rights and interests from being eroded are reasonable and legitimate. At the same time China remains committed to peaceful resolutions of disputes through dialogue and consultation in accordance with international law. China insists on promoting the negotiation on the code of conduct in the South China Sea and strives to reach an agreement as soon as possible. China insists on maintaining peace and stability in the South China Sea and ensuring that all countries enjoy freedom of navigation and overflight in accordance with the international law. These are our positions, which shall not change in the future.

We’ve made some constructions on our own reefs in the South China Sea, which is not aimed at any country. Our purpose is to improve living and working conditions and defense capability so as to fulfill international obligations as the largest coastal country surrounding the South China Sea.

From the onset China didn’t engage in the so-called arbitration case nor accept it, and China’s position is based on sufficient legal foundation and in keeping up with the impartiality of international law including the United Nations Convention on the Law of Sea. First, the unilateral arbitration initiated by the former Philippine government violated the principle of the relevant parties’ consent in the first place, nor did the Philippines conducted exchange of views as a prerequisite before an arbitration was initiated. What the former Philippine government had done also went against bilateral agreements between China and the Philippines and violated Article 4 of the Declaration on Conduct of the Parties in the South China Sea (DOC) as well as the principle of estoppel prescribed in international law.

Second, the subject matters of the arbitration, however packaged, in fact directly concern territorial sovereignty and maritime delimitation which are beyond the scope of the UNCLOS and the jurisdiction of the ad hoc tribunal. It is a typical act of overstepping the power and ultra vires as well as an abuse of the dispute arbitration mechanism.

Third, the ruling of the ad hoc tribunal is full of obvious mistakes. It blatantly uses its self-invented rules to negate and deprive the lawful and legitimate territorial sovereignty, maritime rights and interests of parties concerned. In particular, it says that Taiping Dao, the largest island in the Nansha Islands with an area of 500,000 square meters, is a rock and has no relevant maritime rights. If such a judgment can legally stand, the sea map of the world will need to be redrawn.

The so-called ruling is illegal in three aspects: the initiation of the arbitration is illegal, the set-up of the tribunal is illegal, and the result of the arbitration is illegal. Therefore, China's stance is fully legitimate which serves the purpose of upholding international equity and justice and regional peace and stability.

In addition, some American are worried that whether China will squeeze the US interests in the Asia-Pacific if China gets stronger. The answer is definitely no.

China is also a staunch supporter of peace and stability in the Asia-Pacific region. China is committed to the notions of amity, sincerity, mutual benefit and inclusiveness in its neighborhood diplomacy and sticks to the policy of good-neighborliness and friendliness. China's development is not about depriving the interests of others. It is about making the pie of win-win cooperation bigger together with other countries. China's goal is not to create the so-called "spheres of influence" but to build communities of common interests and shared future. By putting forward initiatives such as building the "Belt and Road", China does not intend to seek dominance over regional affairs but to offer new opportunities for common development to other countries. And China's proposal on the Asian Infrastructure Investment Bank (AIIB) is not meant to create the third wheel, but to improve the existing financial system and remove bottlenecks for financing in the region.

In short, China and the US should work hard in building strategic trust, reducing strategic suspicion and promoting strategic cooperation. Any problems and issue can be solved through dialogue and consultation.

Second we will expand Sino-US cooperation.

About two months ago, I visited Mr. Leo Melamed, Chicago Mercantile Exchange Emeritus Chairman. He told me that at present some people in the United States don’t see the essence of relationship between China and the United States. He thinks China and the US are friends for the next 50 years or even 100 years. I appreciate his point of view. We should cooperate, and carry out more in-depth cooperation.

It can be said that the all-round and strategic cooperation between China and the United States is providing positive energy and new impetus to the peaceful development of bilateral relations and the whole world. Both sides have great potential and space for cooperation on bilateral, regional and global issues. We must take great efforts to make the cooperation bigger and stronger, so that the two peoples and the rest of the world can look at China-US relations as a positive force and benefit from it. We should work together with others so as to reach a consensus that to participate in and support an ever-growing China-US relationship is becoming a consensual action, which constantly strengthens the built-in projecting power of China-US relations.

We should promote the BIT negotiations to move closer to each other and achieve new and important progress, opening up new prospects for Sino-US cooperation and creating new growth points.

We should deepen bilateral economic and trade cooperation and set up higher and more ambitious targets for bilateral trade and mutual investment.

We should cope with global climate change to further expand cooperation while adhering to our respective positions, advance the multilateral negotiation process and assume the responsibility as the two major powers.

We should have in-depth discussion on current global economic and financial situation, strengthen dialogue and coordination on our domestic economic policy, and make practical efforts to promote stable global economic growth and send out a positive signal.

We should actively promote development cooperation under the precondition of the consent and participation of third countries, and make full use of their respective advantages to jointly contribute to the realization of global balanced development and the post-2015 development goals of the United Nations.

We should strengthen dialogue on cyber security, jointly combat all forms of cyber-crime, maintain cyber security, carry out cyber cooperation, and play a constructive role in building a global network of peace, security, openness and cooperation.

The two sides should also strengthen cooperation in international and regional affairs such as cooperation in the Asia-Pacific region, implementation of the comprehensive Iran nuclear agreement, anti-terrorism law enforcement, denuclearization of the Korean Peninsula, global governance, international peacekeeping, wildlife protection and humanitarian relief, and jointly safeguard and promote world peace, stability and development.

We should deepen people-to-people friendship. The Sino-U.S. relations in the final analysis should benefit and involve the people of the two countries, so that it can have a broad and deep social foundation and become an irreversible and unstoppable trend.

At present, many people may also care about the Korean Peninsula nuclear issue and Sino-US cooperation on it. It should be said that China and the United States have maintained close and continuous communication and cooperation on this issue, safeguarding the international nuclear non-proliferation regime and upholding regional security and stability in Northeast Asia.

Firstly, we are opposed to the development of nuclear weapons in the DPRK and the Korean Peninsula can not have nuclear, be it the DPRK or the ROK and its own manufacturing or deployment by others. It does not meet the interests of all parties and is not conducive to the DPRK to maintain its own security if nuclear weapons exist on the Peninsula. Therefore, the peninsula must achieve denuclearization, on which China is unswerving.

Secondly, the peninsula can not have war and chaos. Any war on the peninsula can bring unimaginable and serious consequences. We will adopt new UN resolutions and take further effective measures to effectively block the DPRK's nuclear development program. On the other hand, we must not abandon the efforts of peace talks, because this is the only feasible means to solve the problem. The solution to the Iranian nuclear issue is found after decades of hard negotiations to reach an agreement. As the host of the Six-Party Talks, China has fulfilled its responsibilities and obligations, and has put forward the idea of parallel negotiating in a fair and objective manner, namely the denuclearization of the Korean Peninsula and the replacement of the armistice with a peace agreement. Without the denuclearization of the Korean Peninsula, there is no replacement of the armistice with a peace agreement. Similarly, if the replacement does not proceed , the legitimate concerns of all parties, including the DPRK's security concerns can not be addressed, and denuclearization is also difficult to be brought into reality. These two aspects need to go hand in hand. We need to make clear of the general direction of denuclearization, while addressing all concerns in a reasonable and balanced manner. We are willing to further discuss with other parties on how to advance this parallel approach.

Thirdly, China's legitimate national interests must be safeguarded. The United States and the ROK decided to deploy the THAAD system in the ROK. The X-band radar of THAAD system could cover inland China, that is to say that China's legitimate national security and interests are likely to be compromised. So we strongly urge the United States and the ROK to consider China's legitimate security concerns.

At present, all countries in the world are paying close attention to the US presidential election. We hope that whatever changes may take place in China and the United States, both sides will move forward along the path of building a new model of major country relationship. No matter what kind of contradictions the two countries will have in the future, both China and the United States should respect each other, maintain communication, increase credibility, dispel doubts, continuously expand consensus, resolve differences, and maintain healthy and stable development of bilateral relations. No matter what problems and challenges the international community will face in the future, both China and the United States should have strengthened cooperation with each other in safeguarding world peace and promoting human development.