Undersecretary of State Robert Hormats,
Ambassador Nicholas Platt,
Ambassador David Adelman,
Ambassadors and Consul Generals from the diplomatic corps,
President Fred Teng,
Distinguished Guests,
Ladies and Gentlemen,
Good Afternoon!
It is my great pleasure to join you today in the Yale Club. First of all, I would like to thank the America China Public Affairs Institute for organizing this event, and the contribution it has made over the years in promoting friendly exchanges between China and the United States. My appreciation also goes to all of you who have made your own contribution and supported the development of China-US relations.
I believe everyone here today shares a common interest in China's next stage development. As you may know, China concluded the Two Sessions last month. President Xi Jinping, together with other Chinese leaders, nearly 3000 deputies of the National People's Congress and 2000 members of the Chinese People's Political Consultative Conference, gathered in Beijing to pass legislation and make plans for China's development. Through the Two Sessions, and in particular, Premier Li Keqiang's annual report on the government's work, we can find the important and trending information about China's domestic and foreign policies. Today I would like to share with you my take on that.
China is still an important engine for world economic growth. In 2018, in spite of economic difficulties and downward pressure, China acted on the new development philosophy and achieved a medium-high GDP growth rate of 6.6 percent, accomplishing all economic targets for 2018. The Chinese economy now exceeds 13 trillion US dollars, with imports and exports totaling more than 4.6 trillion US dollars. The upgraded economy now features a more dynamic service sector, which accounted for nearly 60 percent of China's total GDP. It must also be noted that consumer spending contributed as much as 76 percent to economic growth last year, which speaks volumes about the structural reform and sets the stage for sustainable, high-quality development. Those figures I cited show that China continues to perform its role with full vigor as the most important engine of global growth, and it will maintain its irreplaceable role in the world economy.
Facing with a sluggish world economy, you may wonder what will China do to counter the downward pressure? China now has over 100 million market entities with an average of more than 18 thousand start-up companies emerging every day. We will aim at boosting the vitality of the market, energizing the market players, giving greater play to entrepreneurship and innovation, especially in areas such as e-commerce, artificial intelligence, and digital economy. Around 450 billion dollars business taxes have been cut in the last 3 years. We will continue to cut taxes, broaden market access and level the playing field. And the tremendous creativity of the market players will be generated in this process. We believe China's economy will remain an anchor of stability for the global economy.
China still takes improvement of Chinese people's lives as it's top priority. The Chinese government has paid more attention to areas concerning the people's well-being and directed more efforts to address people's major concerns. Over the last year, 13.86 million people in rural areas have been lifted out of poverty, a step closer to beating the official target of eliminating absolute poverty across the nation by 2020. High speed rails, express ways and traffic roads in rural areas have been greatly extended, leading towards a more balanced development among different regions. As for distribution of benefits, personal disposable income has increased by 6.5 percent. Basic pension and health insurance systems have covered almost all Chinese people, forming the largest social safety net in the world. The country lifted the import tariffs on 103 of 138 anti-cancer drugs, 82 types have been included in the basic medical insurance programs. There is still much to do with income, education, pollution, elder care and many other aspects. China's aim is simple: to help the people feel more satisfied, happier, and more secured.
China is still a strong advocate for openness. 2018 is the 40th anniversary of China's reform and opening up. As a fundamental state policy, it has delivered real benefits to the Chinese people and the world, so we have no reason to change it. When we review the course of China's opening-up, we would realize how tremendous a change that has taken place in this country. The total tariff level in China has been reduced to 7.5% in 2018, much lower than most developing countries. Last year, we lifted foreign ownership restrictions in some key basic industries, and the number of new foreign-invested enterprises increased by nearly 70 percent. The just-concluded NPC Session adopted the Foreign Investment Law, which is designed to better protect and attract foreign investments through legislative means. Moreover, we successfully held the first China International Import Expo in Shanghai, and started the construction of the Hainan Free Trade Zone.
Looking forward to the future, China will further open its door to the world economy. We will further shorten our negative list, which means that more areas will be opened up for foreign investment. We will also enhance the protection of intellectual property. In this respect, we will make revisions to the laws on IPR protection and introduce a mechanism of punitive compensation to ensure that all infringements of intellectual property will be seriously dealt with and have nowhere to hide. China's imports of goods and services is estimated to exceed 30 trillion dollars and 10 trillion dollars respectively in the next 15 years, bringing more opportunities to countries around the world. In a word, China will further open up, and China's opening-up measures will not come on a one-off basis, but will be introduced quarter after quarter and year after year.
Ladies and Gentlemen,
This year also marks the 40th anniversary of China-US diplomatic relations. 40 years ago, China's reform and opening up and the establishment of diplomatic relations between out two countries started almost at the same time. The decision that our leaders took 40 years ago with such great vision and wisdom, has not only changed China in a profound way, but also brought great influences to the U.S..
For both countries, the past 40 years have been successful and extraordinary, and have delivered enormous benefits to our peoples. The bilateral trade volume has grown to 633.5 billion US dollars in 2018, 253 times of that of 1979. Bilateral investment started from almost scratch and now has exceeded 240 billion US dollars. More than 5.3 million people travel between our two countries each year. China has been the biggest growing market for the U.S.. And the total US export to China supports 1 million American jobs in 2018. According to the statistics of the U.S. Ministry of Commerce,China remains the biggest travel export market of the U.S., with total revenue of 35.3 billion dollars in 2017. These achievements exceed even the most optimistic predictions when President Nixon first visited China in 1972.
40 years later, China-US relations have come to a critical stage. We face unlimited opportunities, as well as tremendous challenges. The most important thing we can learn from the past is that China and the U.S. stand to gain from cooperation and lose from confrontation. Although a great deal has changed in the world and in both countries, this valuable lesson still holds true today and must continue to guide our interactions. At their meeting in Argentina on December 1st last year, President Xi Jinping and President Trump agreed to pursue a China-US relationship based on coordination, cooperation and stability. This important understanding should be what unites both nations and what the two sides work together to accomplish. Without doubt, competition between our two countries is inevitable. This is normal in international relations. But exaggerating our competition out of all proportion would squeeze our space of cooperation. The right attitude is to focus on expanding our cooperation. This is in our mutual interests,and what visionary leadership should do.
By working together, the vast potential for further China-US cooperation and growth in the next 40 years is unimaginable. In the 21st century, we are increasingly interconnected by the rapid growth of globalization. The interests of China and the U.S. are highly intertwined. Any attempt to decouple the two countries will be futile and harmful. With peace and development as the trend of our times, cooperation is the only right option for China and the U.S.. We are happy to see that in the latest rounds of trade talks in Beijing and Washington DC, the two sides had in-depth discussion on issues of mutual concern, with important progress achieved at the current stage, and with a bright prospect of reaching a final deal in the near future. I want everybody to know that China will hold the 2nd Belt and Road Forum for International Cooperation this April and the 2nd China International Import Expo this November. The U.S. is welcome to participate in these important events to share the opportunities.
Forging ahead, China will continue to work with the U.S. to properly manage differences, jointly advance China-US relationship featuring coordination, cooperation and stability, so as to bring more benefits to our two peoples and beyond. In this regard, I would encourage every one of you to continue to leverage your strength, and make new breakthroughs in keeping the sound and healthy growth of our relations.
Thank you very much!