Kerry: US, China Building A New Model of Major Country Relationship

Beijing, May 17, 2015, — Secretary John Kerry and Chinese Foreign Minister Wang Yi holds joint press conference.

MR LU: (Via interpreter) Friends from the press, good afternoon. Just now, the two foreign ministers have held their dialogues, and they are ready to meet with you and take up your questions. Now, I would like to give the floor to Foreign Minister Wang first.

FOREIGN MINISTER WANG: (Via interpreter) Friends from the press, good afternoon. Just now, I have held a constructive meeting with Secretary Kerry, where the two of us had candid and in-depth exchange of views on China-U.S. relationship and other issues of mutual interest, and we reached a lot of agreement.

Two years ago, when the two presidents met in the Sunnyland, they agreed to build a new model of major country relationship between China and the United States. Over the past two years, thanks to the concerted efforts of both sides – in particular, thanks to the personal commitment and promotion of the leaders of both countries – this new model of relationship has made much headway in terms of both conceptual development and of the actual practice. Last year, China-U.S. two-way trade reached 555.1 billion U.S. dollars, and the stock of our two-way investment exceeded 120 billion U.S. dollars. More than 4.3 million people traveled between the two countries last year. All these numbers have set record highs in history.

Our two countries have maintained frequent contacts at the top and all the other levels, and we have had productive cooperation in important fields ranging from economy, mil-to-mil exchanges, people-to-people exchanges, and also a contact between localities. The two sides have also carried out close communication and coordination on important international and regional issues.

In September this year, President Xi will be paying a state visit to the United States. The most important task for the meeting between Secretary Kerry and me today is to make preparations for the presidential visit and to compare notes with the other side. Just now, together with Secretary Kerry, we exchanged views concerning the arrangement of events, the agenda items, and the outcomes of this visit. Both of us are of the view that this visit by President Xi to the United States is the paramount priority for China-U.S. relationship this year, which will have far-reaching and major implications for China-U.S. relationship in the days ahead. The two sides will continue to work in close tandem with each other, make careful plans, accumulate outcomes, and build up the atmosphere to make sure that the visit is smooth-going and successful.

To achieve this, we have to work together to make sure that the seventh round of the China-U.S. S&ED – the Strategic and Economic Dialogue – and the sixth round of the High-Level People-to-People Consultation between China and the United States, to be held in the United States in the latter half of June this year, to be as productive as possible. We need to further deepen our economic and trade cooperation and speed up the BIT, the bilateral investment treaty negotiations. We hope the U.S. side will take concrete measures to ease civilian-use high-tech export control vis-a-vis China.

We need to continue to maintain the good momentum of the growth of our military-to-military relationship and follow through on the mechanism of notification of major military activities between the two sides, and reach an early agreement on military aircrafts covered by the code of safe conduct for maritime and air encounters.

We need to strengthen dialogue and cooperation in the legal and the law enforcement field, and try to make new progress in the pursuit of fugitives and the recovery of their criminal proceeds. We need to strengthen communication, coordination, and cooperation on international and regional issues, including the Iranian nuclear issue, the Korean nuclear issue, Afghanistan, and the prevention and control of the Ebola epidemic, so as to continue to add new strategic dimensions to this new model of relationship – major country relationship between China and the United States.

We need to strengthen communication on Asia Pacific affairs and jointly explore the prospect of harmonious coexistence and win-win cooperation between China and the United States in this region. We need to continue to strengthen our communication and coordination on climate change to jointly ensure the success of the upcoming climate conference in Paris later this year. Meanwhile, we need to also work together to advance our bilateral practical cooperation on climate change.

This year marks the 70th anniversary of the founding of the United Nations and the end of the World Anti-Fascist War. As allies and victory parties during the Second World War, China and the United States have common interests in upholding the outcomes of the victory of the Second World War and also upholding the existing international order with the United Nations at its center.

Both sides are of the view that we have far more common interests than differences between us, and dialogue and cooperation always represent the theme of our bilateral relationship. Both sides need to act in a spirit of mutual respect, seeking common ground while shelving differences, and address the differences and sensitive issues between us in a constructive manner. China also expounds its principled stance on such issues related to Taiwan and Tibet.

China-U.S. relationship is one of the most important bilateral relationships in the world, and our two countries jointly shoulder the responsibility and obligation to uphold both peace and promote world development. As long as both sides continue to act in the principle of non-confrontation, non-conflict, mutual respect, and win-win cooperation, and stay committed to the path of building a new model of relationship – major country relationship between China and the United States, we will be able to usher in a bright prospect for China-U.S. relationship and bring more benefits to the people in both countries and enduring peace and prosperity for the world.

MR. LU: (Via interpreter) Thank you, Minister Wang. Now Secretary Kerry, the floor is yours.

SECRETARY KERRY: Well, thank you very much, Minister Wang. I’m really delighted to be back in China and I thank you very much for your generous welcome today. You and your colleagues have gotten our trip off to a very constructive beginning and I appreciate the comments you made about the importance of dialogue and the importance of working through disagreements, and mostly building on the areas where we agree that great progress can be made.

As Foreign Minister Wang said, we’ve just had a very productive meeting, and one of the reasons that we’re late is that it took longer and we dug into a number of issues in depth, and we’ll continue in a few moments over lunch.

This is my fifth visit to China as Secretary of State, and the reason for that is simple. As I’ve said previously, before President Obama and I traveled to Beijing last fall, the relationship between the United States and China is certainly one of the most consequential, if not the most consequential relationship in the world. In recognition of that and America’s commitment to Asia, Under Secretary Sherman traveled here a few months ago. Deputy Secretary of State Blinken was here about a month ago. I am now here about a month before we have our economic and security dialogue to take place in Washington. And other high-level visits are continually taking place, including military-to-military as well as the Secretary of Homeland Security Johnson was here recently, and Secretary of Energy Ernie Moniz was scheduled – had to delay, but will also be here soon.

And there are three key meetings that we are all working on together to prepare for in order to build success. One is the Security and Economic Dialogue that will take place in June in Washington. Two is the summit between President Xi and President Obama to take place in September. And three is the global meeting that we are working on together regarding climate change in Paris in December.

So thanks to focused diplomacy and the leadership that President Obama and President Xi have displayed, today our nations are collaborating to address not just bilateral and regional matters, but some of the most complex global challenges that the world has ever seen. That includes our work together on curbing the disease Ebola, it includes our work together regarding the DPRK – North Korea – and its nuclear program, and it also includes our work together with respect to the P5+1 nuclear negotiations with Iran.

Foreign Minister Wang and I have already spent time discussing some of that today, and I’m personally grateful for his personal commitment and hard work, the contributions they made – China made to Lausanne, to the discussions there and the negotiations, and now to the ongoing discussions. But from the moment those talks began, China has been playing an important key role as a P5 member. Our nations remain closely aligned in this effort. We are united along with the rest of our P5+1 and EU partners. We all understand that unity has been the key to getting where we are today, and it will be the key to completing a good deal and seeing it fully implemented.

We still have a long way to go. Many technical issues remain to be resolved. But we will continue to work hard as the June 30th deadline approaches. And we are all united and committed to do all we can to finalize an agreement that cuts off all of Iran’s pathways towards enough fissile material for a nuclear weapon, and gives the international community confidence that Iran’s nuclear program is exclusively peaceful.

On another nonproliferation challenge, we have consistently agreed in all of our meetings since I became Secretary of State and we have met that North Korea’s nuclear and missile programs are a threat to regional stability, and we have consistently agreed to enhance cooperation to bring about North Korea’s denuclearization. As with Iran, Foreign Minister Wang and I have always agreed that a mix of negotiations and pressure are needed to address this challenge, and North Korea needs to live up to its international obligations and commitments. And it is obvious that North Korea needs to recognize that it will not succeed in developing its economy or breaking out of diplomatic isolation if it continues to reject denuclearization.

The United States and China are also cooperating more closely than ever to address climate change, one of the greatest threats facing our planet today. Last fall, our respective presidents came together to announce our countries’ greenhouse gas commitments, the reductions, and we continue to call on other nations around the world to set their own ambitious targets. And we agreed this morning that as we get closer to the UN Climate Conference in Paris later this year, the United States and China, the world’s two largest greenhouse gas emitters, will elevate our cooperation and coordination so that we can reach the kind of global agreement that we will need to ultimately address this threat.

We’re looking forward to building on our cooperation in other areas as well, including international development assistance and the fight against violent extremism. We welcome China’s increased engagement with Afghanistan and its support of an Afghan-led, Afghan-owned peace process. Together, the United States and China are committed to supporting political cohesiveness and ensuring Afghanistan never again becomes a safe haven for terrorists.

And there are many other issues that we are working on together – trade, bilateral investment treaty, any number of different considerations on a global basis. But even as we work on these many, many issues, obviously, there are also areas where our nations have differences. And Foreign Minister Wang and I discussed those as well. We discussed our mutual interests and principles on how to handle maritime disputes in the East China Sea and the South China Sea. The United States has stated that we are concerned about the pace and scope of China’s land reclamation in the South China Sea. And I urged China, through Foreign Minister Wang, to take actions that will join with everybody in helping to reduce tensions and increase the prospect of a diplomatic solution. And I think we agree that the region needs smart diplomacy in order to conclude the ASEAN-China Code of Conduct and not outposts and military strips.

And I think one of the things that characterizes the strength of – or the growing strength of our relationship and the willingness to cooperate is the fact that on a maritime dispute or on other issues – cyber issues or human rights, other areas – where we may have differing opinions, we don’t simply agree to disagree and move on. Both of our nations recognize the importance of talking to each other candidly about those disagreements and trying to find a cooperative road ahead.

It’s only by talking through differences on a regular basis that you can actually work to narrow them over time. And that is the mark of an effective partnership. So I look forward to continuing my discussions with Foreign Minister Wang through the day, and also to the meetings that I’m going to have with State Councilor Yang Jiechi, with Premier Yi, with Vice Chairman Fan, and tomorrow with President Xi. These discussions will help us to build this cooperation and this relationship. And these conversations will set the stage for what we are confident will be a productive Strategic and Economic Dialogue in June, and certainly for President Xi’s trip to Washington this fall.

There is no question but that our nations share extraordinary opportunities that are looking at us as we build the history of this century. We have a lot to accomplish together in the coming years. As two of the world’s major powers and largest economies, we have a profound opportunity to set a constructive course on a wide range of issues that will affect everybody all across this planet. So the United States looks forward to continuing to build this relationship, to work with China, to build on our partnership of today, in order to create the most constructive future that we can, and not just for the people of our two countries but for millions of people around this planet who depend on great and powerful nations to help set high standards of behavior and of aspiration. Thank you.

MR LU: (Via interpreter) Well, thank you, Secretary Kerry. And now, Foreign Minister Wang and Secretary Kerry, though their time is very limited, they will be happy to take two questions from the floor. Firstly, I would like to ask one American journalist to ask one question to Secretary Kerry.

MS HARF: Great. The U.S. question is from David Brunnstrom of Reuters. The microphone is coming to you.

QUESTION: Thank you very much. I wonder if I could ask both sides about your different visions for Asia Pacific prosperity, namely the TPP and the AIIB, and what the prospects are of China joining the former and the United States the latter at some point in the future. And to follow on from that, one of the dangers in the future to bilateral cooperation and regional prosperity posed by tensions in the South China Sea, and particularly the possibility of U.S. patrols inside China’s 12-mile limit around the Spratly Islands.

And could I ask the Secretary to clarify, does the United States plan to carry out these patrols? And for the foreign minister to tell us how China would respond in the event of those patrols taking place?

I know this is a long question, but I wanted to also add on North Korea. I wondered if you could tell us if you share concerns about the latest missile test there and whether you see the prospects of a deal on Iran’s nuclear program opening the way for one on North Korea in the future. Thank you.

SECRETARY KERRY: Well, let me try to address all four questions – (laughter) – as quickly as I can.

With respect to the AIIB, there’s an enormous amount of misunderstanding, but let me try to be clear. There is a pressing need to enhance infrastructure investment throughout Asia as well as around the world. And the United States welcomes new multilateral institutions, including the Asia Infrastructure Investment Bank, provided that they share the international community’s strong commitment to high-quality standards, including genuine multilateral decision making, ever-improving lending requirements, and environmental and social safeguards. Those are the high standards that apply to global financial institutions.

And we will continue to engage directly with China and with other countries in order to provide suggestions as to how the AIIB can best adopt and implement these particular standards. But with that, we welcome the AIIB, and we encourage it to co-finance some projects with existing institutions like the World Bank and the Asian Development Bank. And we are confident that under those circumstances, it can make an enormous difference, and we would strongly encourage it, as we talk today, to embrace a percentage of its allocation to – a significant percentage to clean energy, alternative energy, renewable energy, to sustainable environmental and other kinds of projects. And because of climate change in the United States, we are ending any funding – public money – that funds coal-fired power projects because of their impact on the climate. And we encourage China and other countries to do the same.

Now on the TPP, we welcome any country – we have a group of countries now come together to negotiate, but we welcome any country to come in to meet the standards of the TPP, and ultimately account for a standardization of the way in which people will approach trade, development, and investment. And I want to emphasize this – the TPP is not in opposition to anyone, any region, or anything. It is a proactive effort to raise the trade standards and transparency accountability of doing business on a global basis. It will set high standards on issues like labor, the environment, state-owned enterprises, intellectual property protection, in a part of the world where we believe those standards are still in flux and being determined. And this will help to create the rules of the road in a way where everybody benefits.

You may ask, “Why is that?” Because in today’s knowledge economy, in the knowledge economy of a global marketplace, stronger intellectual property rights protection actually encourages greater industrial production and it encourages foreign direct investment because it provides accountability for people’s investments. And what we have found in the United States, where today, we’re blessed to have unemployment below 5 percent, and where – around 5 percent, excuse me – and where we have enormous growth and innovation and entrepreneurial activity taking place, we believe that these standards encourage foreign direct investment in technology-intensive industries; it supports higher wages; and it fosters technology transfer and innovation.

Now I’ve taken a little longer than I wanted, but let me come very quickly to Korea and Iran. China is a vital partner in the Six-Party process with a very unique role to play because of its economic, diplomatic, and historical ties with North Korea. We share the common goal of peace and stability in the Korean Peninsula, and we agree on the need for denuclearization in a peaceful manner. President Xi and President Obama affirmed their fundamental agreement and commitment to the denuclearization of Korea – North Korea in their public comments at the bilateral summit last November. So we intend to remain deeply engaged with China, which has unique leverage, and we appreciate many of the steps China has taken already over the past two years to implement the UN Security Council sanctions. But we will continue to work to make it absolutely clear to the DPRK that their actions, their destabilizing behavior, is unacceptable against any international standard.

And I’m sure that Foreign Minister Wang would join me in expressing the hope that if we can get an agreement with Iran, that that – excuse me – that if we can get an agreement with Iran, that that agreement would indeed have some impact or have a positive influence in describing how you can come to the realization that your economy can do better, your country can do better, and you can enter into a good standing with the rest of the global community by recognizing that there is a verifiable, irreversible denuclearization for weaponization, even as you could have a peaceful nuclear power program. And hopefully, that could be a message, but whether or not DPRK is capable of internalizing that kind of message or not, that’s still to be proven.

QUESTION: Sorry, can I just follow up?

MS HARF: I think we’re a little tight on time, sorry.

SECRETARY KERRY: Four is enough. (Laughter.)

MR. LU: (Via interpreter) Now I would like to ask one Chinese journalist to ask one question to Foreign Minister Wang from CRI.

QUESTION: (Via interpreter) From China Radio International. My question is: Recently, some American experts, scholars, and media are of the view that Chinese proposals, including the Asia security concept, the AIIB, setting up the Silk Road Fund and the maritime and land Silk Road initiative are all geared to challenge the position and role of the U.S. in the Asia Pacific region and squeeze the United States outside of Asia. How do you look at this issue?

SECRETARY KERRY: We look – is that for me?

FOREIGN MINISTER WANG: That question for me. Okay. (Via interpreter) Well, such notion does crop up frequently, but I have to say that the fact we are seeing is there are more and more interaction between China and the United States in Asia, and our cooperation is becoming increasingly more close. And the Asia Pacific region has become the priority place for China and the United States in their effort to put in place a new model of major country relationship. And I talked about a whole range of cooperation items with Secretary Kerry just now, and many of them are issues in Asia.

China is a member in Asia, and very naturally, we need to contribute our share to Asia’s peace and development. To achieve this, China has framed a series of important and positive proposals, including the Asia security concept and the land and maritime Silk Road initiatives and so on, which testify fully to China’s readiness to work with all countries for Asia’s peace and stability. These, of course, have been very widely, warmly received and supported by countries in Asia. Asia, of course, in the first place, is the Asia of the Asian people.

Meanwhile, we always believe that Asia should be an open and inclusive Asia, because only inclusiveness and openness could make sure that Asia would always keep abreast with the rest of the world for enduring peace – for enduring development and prosperity. Take the AIIB as an example. Right now, it has got 57 founding member countries, and among them, 23 are from regions outside of Asia. This shows fully that when we talk about openness and inclusiveness, we are not simply talking the talk; we are actually walking the walk.

The United States is an important country in the Asia Pacific region, and we welcome a positive and constructive role of the U.S. in Asia Pacific affairs. And we stand ready to strengthen communication and cooperation with the U.S. side on this. As globalization continues to grow, today’s world is a world of cooperation instead of confrontation. It is a world of win-win outcomes instead of a zero-sum game. President Xi has proposed to build a new model of international relationship with win-win cooperation at the center. And I believe China and the United States are fully capable of continuing to strengthen strategic communication at both the bilateral and at the international levels, and carry out useful cooperation in all regions in the world, including the Asia Pacific, so as to continue to make our due contribution to world peace and prosperity.

Just now, the Secretary talked about maritime issues. Though the journalist violated the rule that one question only, but I respect your right to ask questions, so I would like to add a couple of words on this. Firstly, I would like to re-emphasize or reaffirm here that the determination of the Chinese side to safeguard our own sovereignty and territorial integrity is as firm as a rock, and it is unshakable. It is the request from our people and their government, as well as a legitimate right of ours.

Meanwhile, it has always been our view that we need to find appropriate solutions to the issues we have through consultations and negotiations among the parties directly concerned with peaceful means, in particular with the diplomatic means, as mentioned by the Secretary just now, on the basis of respecting historical facts and international law. This is our set policy, and this position will remain unchanged in the future.

And another thing I would like to let you know is that as a signatory party to the UNCLOS, the United Nations Convention on the Law of the Sea, China will of course honor our international obligations enshrined in this document. And on China’s development on some of the islands and reefs in Nansha, this is something that falls fully within the scope of China’s sovereignty. However, regarding the concerns from the parties on this matter, we hope to continue to have dialogues to better our mutual understanding. We are having such dialogues with the United States, and we are also continuing the talks with the ASEAN countries. And we will continue with this practice of conducting dialogues on this matter.

China and the United States do have differences on the South China Sea issue, but we also have a lot of agreement. For instance, we both hope to maintain peace and stability of the South China Sea, and we are both committed to the international freedom of navigation enshrined by international law. And we are both for settlement of the disputes through dialogues and consultation in a peaceful way. And as for the differences, our attitude is it is okay to have differences as long as we could avoid misunderstanding, and even more importantly, avoid miscalculation.

We welcome the positive remarks made by the Secretary on the AIIB. The AIIB is a multilateral institution, so naturally, its operation will be observing international rules. And the AIIB is also ready to carry out cooperation with other multilateral institutions, including the World Bank and the Asia Development Bank. You also raised the question on the relationship between the AIIB and the TPP.

And I wish to tell you here on this is that the defining feature of the AIIB is its openness. And for TPP, we’ll hope, as the Secretary has said just now, will be an open institution so that it will dovetail with the existing multilateral trading regime for the promotion of free trade in the world.

You also asked questions on the Iranian and nuclear – Korean nuclear issues. Secretary Kerry has said a lot on them already. What I would like to add is that as members – permanent members of the UN Security Council and as key members of the nonproliferation regime, China and the United States have the responsibility to work together with the rest of the international community to uphold the sanctity of the international nonproliferation regime, and use diplomatic means to find appropriate solutions to those nuclear issues to achieve lasting peace and stability in the regions concerned. We stand ready to work together with all countries in the world on those issues. Thank you.

SECRETARY KERRY: I just have one question for the foreign minister. I want to know if “Talk and talk and walk the walk” rhymes as well in Chinese. (Laughter.)


MR LU: (Via interpreter) That’s the end of the press conference. Thank you for coming.