16 January 2004

Distinguished guests,

Ladies and Gentlemen:

    First of all, on behalf of the Chinese Embassy, I would like to extend a warm welcome to all of you to this Forum, jointly organized by the Embassy and the Foreign Investment Administration Department of the Chinese Ministry of Commerce with the kind support by Deloitte.

    In my opinion, the launching of the China Investment Forum is both useful and timely. Because investing in China is now facing a rare window of opportunities. And there are quite a number of favourable conditions:

    1. The Chinese economy has maintained a sound and rapid growth and the potential of the market is enormous. Last year, the economy enjoyed a growth rate of 8.5% in defiance of the negative impact of Sars. China's GDP topped 1.3 trillion US dollars, with per capita GDP reaching 1000 US dollars. It is estimated that the Chinese economy will keep growing at around 7% in the coming 20 years or so. By the time of 2020, China's GDP will be quadrupled that of 2000 and reach 4 trillion US dollars.

    2. The quality of the labour force is high while the cost is low.  Given the huge base of the Chinese population, this advantage is expected to be maintained for a long period to come. Chinese universities will recruit about 4 million new entrances this year. That means there will be millions of high quality university graduates flowing into the labour market on a year by year basis.

3. Both the hardware and the software of the investment environment have been greatly improved. The building of infrastructure such as aviation, transportation, telecommunication, high-ways, railroads and ports, has made big strides in recent years. For example, the number of telephone subscribers and mobile phone users surged to over 530 million, making China the No.1 in the world. In the area of transportation, China has established its own high-way network with a total length of 30,000 kilometers, second only to the US. The legislation especially those in relation with foreign economic cooperation have also witnessed great improvements. Business transactions now can be conducted on the basis of law which has been closely integrated with international rules and regulations.

    4. After accession to the WTO, China is opening wider to the outside world in more depth and spheres. Finance, retail, telecommunications and other service sectors which used to be confined to domestic businesses will be opened in a gradual manner in line with China's WTO accession commitments.

    5. The demand on investment is huge. The implementation of the Western Development Programme and the Strategy on revitalizing North Eastern Old Industrial Bases, Beijing's holding of 2008 Olympic Games and Shanghai's hosting of 2010 World Expo will all present excellent opportunities for investments.

    6. China will continue to maintain a stable political and social pro-business environment. As many of those who have already invested in China have noticed, bureaucracy in China has been greatly reduced in recent years and governments at all levels are keen to attract foreign investment, and things can be done with great efficiency and swiftness in today's China.

    In short, China has become a priority destination for international investment and has attracted the largest foreign investment in the past few years among developing countries. These facts have clearly demonstrated the investors' confidence in China's prospect of economic development and China's market.

    I'm very pleased to note that in recent years, UK-China bilateral relations have enjoyed a rapid development. Both countries and peoples have drawn real benefits from our growing economic and trade cooperation. Mutual investments serve the fundamental interests of both China and Britain. So far, Britain has maintained the status as China's No.1 investor among EU countries. However, British investment in China only accounts for 4% of its total overseas investment. The investment from medium and small enterprises is still limited. Obviously, there are still great potentials to be explored. I would like to urge the British enterprises to be bolder in going out to invest in China and make bigger contribution to our economic cooperation. We are ready to provide any assistance to facilitate this process. This Forum is an example in our efforts. I believe this Forum will help the British entrepreneurs especially those from the medium and small companies to have a better understanding of China's investment policies and opportunities. I do hope you find this Forum interesting and informative. We also welcome your comments and advices for further improvement so that by joint efforts, we can promote the UK-China economic cooperation to a new level.

    Finally, I wish this Forum a complete success.

    Thank you.