Your Excellency, Ladies and Gentlemen,
I am delighted to be here at this important conference on China’s economy and its global impacts. I commend the Confucius Institute at UCD and the Chinese Economic Association for their decision to host the central event of their annual calendar here in Dublin.
I also commend the organisers for the impressive range of participants which are assembled.
As you have already heard from some distinguished speakers, this conference represents a great opportunity to engage in detail on topics which are of central importance to everyone.
I hardly need to underline this point to such a distinguished audience but China’s remarkable economic development over the past thirty years and its growing influence on the world economy are of central importance to everyone.
Since China commenced its opening up and reform policy in 1978, and the dragon stirred from its slumber, there has been unprecedented growth and development. We are talking about more than 7 per cent real economic growth each year sustained over three decades. And now the dragon is very much awake, China has emerged from the global economic crises in robust shape to become the second largest economy in the world.
The scale of China is staggering; the most populous country on the planet with over 1.3 billion people, the world’s largest exporter, a pre-eminent destination for Foreign Direct Investment.
In global terms, China’s growth played a key role in the international recovery which is now underway.
The positive impact of China’s stimulus package, with massive public investment and fiscal measures to support employment and consumption was felt around the world. Despite current challenges such as inflation, there is no doubt that China’s economic weight represents great potential for enhancing global economic development over the next few years.
The EU collectively is now China’s largest trading partner with exports of over €113 billion last year. China is the EU’s second largest trading partner, just behind the US.
In Irish terms, China is now our largest trading partner in Asia, and our 8th largest partner overall. The importance of China was recognised in the Asia Strategy adopted by Government in 1999. That Strategy had two principal objectives; to improve political and business contacts throughout Asia and to raise awareness of Ireland both as an investment location and as a source of high quality goods and services. The Strategy resulted in a significant development of Ireland’s relationship with China in particular over the past decade.
A simple illustration of this is the fact that at the turn of the century, bilateral trade with China was worth €715 million annually. Last year, it was €4.2 billion. A further example of our enhanced relationship is the frequent exchange of high level visits in both directions. Our President visited China last year, meeting Vice President Xi Jinping and was present for the Ireland Day at the Shanghai Expo in June. Ireland was honoured to have received a visit from Mr. Li Changchun of the Standing Committee of the Politburo last September.
I recently received Mr. Wang Zhaoguo of the National People’s Congress. I am looking forward to visiting China, including leading a trade mission, if possible later this year, and arrangements for this are currently being discussed by our Embassy in Beijing with the Chinese authorities.
In all areas, trade, education, food and agriculture, tourism and human contacts our relations are widening and deepening. Our cities are developing sister-city relationships: Cork has been twinned with Shanghai for several years, just last month Dublin formally twinned with Beijing and Galway and Qingdao have developed a positive relationship.
There is now a thriving Chinese New Year festival held in our capital and St Patrick’s Day festivals take place in Beijing and Shanghai. Riverdance continues to be a huge success throughout China.
In the Programme for Government we have committed to implementing the Trade Strategy, Trading and Investing in a Smart Economy which, of course, retains a strong focus on China.
It is a key priority for Ireland to grow our economic and trading relationship with China, as part of Ireland’s overall aim for economic growth and recovery.
There is no denying that Ireland faces very serious challenges. However, my Government entered office with a firm commitment that it would get the economy moving, restore confidence, fix our banking system and support the protection and creation of jobs.
In a matter of months we have already put in place an ambitious restructuring plan which will transform the landscape of the banking system here and we have announced a new jobs initiative with an emphasis on reinvigorating the domestic economy, within the limited resources available to us. A comprehensive spending review is already underway. It will feed into the budget process in December and will help us meet our overall fiscal targets.
New figures show that our economy has returned to growth and revised figures now indicate that we had a balance of payments surplus last year, based on strong export performance. Exports to China increased in 2010 by 7.5% on the previous year.
We are meeting the qualitative quarterly targets set out by our funding partners in the IMF and the European Union and this Government is determined to use our unprecedented mandate to continue to meet those targets.
Our sovereign debt has an investment grade status with ratings agencies such as Standard and Poor’s, Fitch and DBRS. The downgrade by Moody’s this week was disappointing, given the progress we are making with our funding partners and given the announcement on Monday that Eurogroup Ministers stand ready to enhance the flexibility of the European funding mechanisms, including lengthening maturities on loans and the lowering of interest rates. It remains the case that Ireland has sufficient funding until the end of 2013 and our task in the meantime is to see through our agreed programme and reforms in order to put our fragile recovery on a sustainable footing. I can tell you that this is exactly what we will do.
We recognise that we need to grow our way out of our current difficulties. And this is where our trade relationships with external partners are key. Ireland is still a small, open economy with a vibrant export sector. Our recovery will be export-led and our strong trading relationship with China is an essential part of ensuring further growth.
I do not think that there is complacency on the part of anyone involved in the Ireland-China commercial relationship, however, there is massive potential to enhance this further across a range of sectors.
Areas of real potential include; energy and green technologies, Food and Agriculture, Financial Services and Aviation Leasing, Pharmaceuticals, Medical Devices and Educational services. These are some of the sectors where the Government and the State Agencies will be focussing attention in the future.
So with those comments on China’s economy, the bilateral relationship with Ireland, our own economy and the prospects for the trading relationship into the future, I would like to wish you well in your work over the course of today and tomorrow. We look forward to the outcomes of your discussions and your studies.
Thank you