 Now, ladies and gentlemen, it's my great honor and pleasure to welcome together with you the premier of the People's Republic of China, Premier Li Keqiang and the founder and Executive Chairman of the World Economic Forum, Professor Klaus Schwab. Our Excellency, Li Keqiang, Premier of the People's Republic of China, distinguished heads of state and governments, members of governments, dear members and guests of the World Economic Forum. A very warm welcome to all of you. It is a great pleasure to be back here in Dalia. We especially appreciate your presence, Premier Li, particularly at this critical moment. And of course, we all look eagerly forward to your statement. Since we met here eight years ago to inaugurate the first annual meeting of the new champions, the world has changed substantially. The world economy has become even more interconnected and is facing challenges, such as everywhere the need for growth combined with social and environmental sustainability. At the same time, we are faced with a technological revolution, which is moving in unprecedented speeds and comprehensiveness that the world has never seen before. In many ways, China is positioned to be at the forefront of the new technological revolution and to reap substantial benefits from its transformation. Strategies such as a mass entrepreneurship and innovation, One Belt, One Road, Internet Plus and China Manufacturing 2025 are modernizing the economy and upgrading traditional industries. Mr Premier, this meeting affirms our conviction that China will continue its success story not only for the benefit of its own people, but also as an indispensable partner for creating a more prosperous and peaceful world. The fact that over half of the participants, more than 1,000 of you, our foreigners coming from outside of China, is in itself a great demonstration of confidence in China's capability to shift gears to a more sustainable platform of growth while also containing vulnerabilities and continuing decisive structural reforms. Now, ladies and gentlemen, please join me in welcoming His Excellency Li Kezhang, the Premier of the People's Republic of China. Heads of State and Government, distinguished guests, ladies and gentlemen, it gives me great pleasure to meet all of you in the beautiful city of Dalian in the golden autumn season of September. On behalf of the Chinese Government, let me extend warm congratulations on the convening of the meeting in Dalian and welcome all our guests to the forum. I also want to thank the journalists for covering our meeting today. Yesterday, the moment I arrived in Dalian, I visited a local maker space in the city. There was a small company in the maker space with only 10 employees. Although the company is only 2 years old, what it has achieved is truly impressive. The company has attracted 280,000 registered engineers on its online platform and it has information and data of over 30,000 machine tools in the entire northeast area. With the work of this company, the machine tools in the area have been put into better use and it has connected supply and demand and more importantly, the company has with the support of 280,000 engineers digitalized the machine tools in the area and provided solutions for upgrading these machine tools and they have already developed more than 100 products. The company is quite ambitious. Their dream is to upgrade all these 30,000 low-end machine tools and they also want to develop new type of intelligent machine tools. Actually now in China, we have tens of thousands or even millions of maker companies like the one I saw in Dalian. No matter they are successful or not, they all deserve to be called the new champions. They are the future and the hope of economic growth and they are also drawing the new blueprint for growth in China and beyond. As you all know, the world economy is going through a weak recovery. Quite a number of international institutions have marked down their predictions of global growth. The more complex and intricate the situation, the more we need confidence and hope. The theme of our annual meeting today, charting a new cause for growth, is highly relevant. I think it reflects the consensus of all the parties to explore a new path for global growth. I shared with you this story for the purpose of addressing your concerns about the future of the Chinese economy and the world economy. So here is my message. Despite some moderation in speed, performance of the Chinese economy is stable and moving in a positive direction. Having said that, we also face some difficulties but on the whole, we have more opportunities than challenges. It is the creativity and entrepreneurial passion of the public that gives us confidence in overcoming the difficulties we face. We have the capability to achieve all the major targets of economic development for this year and lay a solid foundation for our economic growth in the future. Given the slowdown in global growth, it is indeed not easy for China to achieve the 7% growth in the first half of the year. Because we are now already a 10 trillion US dollar economy and a 7% increase in the 10 trillion US dollar economy is even bigger than the double digit increment in the past. And the 7% growth rate is still among the highest of the world's major economies. What is encouraging is that the economic structure is improving. Service sector already accounts for half of China's GDP and consumption contributes to 60% of growth. Growth in high-tech industries is notably higher than the entire industrial sector. Consumer demands for information, cultural and health products are booming. Energy conservation, environmental protection, grain economy are flourishing and new growth drivers are rapidly taking shape. The stable performance of the Chinese economy has improved the well-being of the people. How the people feel about their life is the most important. Since the beginning of this year, employment has steadily expanded. 7.18 million new urban jobs were created in the first half of the year, completing 72% of our annual target. Survey unemployment rate in major cities is around 5.1%. And per capita disposable income is growing faster than the economy. And the income of rural residents is growing faster than that of urban residents. Price level is basically stable and consumers are now more willing to spend. Total retail sales of consumer products has increased by more than 10%. I have said on numerous occasions that as long as we have fairly sufficient employment, rise in household income and improvement in the eco-environment, growth speed that is a little bit higher or lower is both acceptable to us. The stable performance of the Chinese economy has also benefited the whole world. In the first half of this year, China contributed to about 30% of global growth. Because of the slide in commodity prices, the foreign trade volume has somewhat moderated. But the actual amount of commodity imports has not dropped and even climbed up by a certain margin. China will continue to implement a more proactive import policy and put greater emphasis on the quality of foreign trade. So we will only buy more from the world in the future. China's outbound investment continues to enjoy rapid growth. And in tourism, there is a notable increase in the number of outbound tourists. Last year, Chinese tourists made over 100 million trips abroad. In the first half of this year, this number grew by another 10%. And the Chinese tourists are going abroad not just for sightseeing but also for shopping. And their spending has made contribution to the growth of many countries. This shows that they are confident in the future of the Chinese economy because we have a celebrated tradition of frugality. If they do not have a stable source of income, they will not feel free to spend. So these facts show that China is not a source of risk of the world economy but a source of strength for global growth. That being said, the Chinese economy has also come under quite a number of difficulties and downward pressure. But it is still running within the proper range. China is an economy that is closely integrated with the international market. Given the weak growth of the global economy, China cannot stay unaffected. And the deep-seated problems that have built up over the years are also being exposed. China is now in a transition from traditional drivers to new drivers from an extensive model of growth in the manufacturing sector to an intensive model of growth. And from over-reliance on investment to a growth model driven by consumption and investment, this is going to be a painful and a treacherous process. So ups and downs in economic performance is hardly avoidable, which is natural in the time of transition. If I can borrow a term from traditional Chinese medicine, it is the pulse of the Chinese economy in this transitional stage. In the past two months, there have been slides or ups and downs in certain economic indicators. But due to the policy measures we adopted in the previous stage, the positive factors in the economy are building up. So some of the economic indicators have improved. So on the whole, the fundamentals of the economy have remained unchanged. Despite ups and downs in economic performance, the underlying trend is positive. We will not be swayed by short-term fluctuations in the economy, but we will not take it lightly either. We are taking necessary measures of targeted, discretionary and precision micro-control for the purpose of mitigating volatility and preventing transmissional and amplifying effect. If there are signs that the economy is sliding out of the proper range, we have adequate capability to deal with the situation that the Chinese economy will not head for hard lending. In recent years, despite downward economic pressure, we have not resorted to excessive supply of money or massive stimulus. Instead, we have relied on reform to boost the vitality of the economy. This has not only ensured stable economic performance, but also created space for further micro-control. The fiscal deficit ratio of China's central government is relatively low compared with other major economies, and we have plenty of tools at our disposal to innovate micro-control policies. It's like playing a Chinese chess game. We need to be careful with the immediate move you take. That is to say, we need to take targeted measures to resist downward pressure on the economy. But at the same time, we need to build momentum for sustainable and healthy economic growth in the long term. Ladies and gentlemen, the Chinese economy will only have an even brighter future, and the Chinese economy is moving in a positive direction. This is not an unrealistic optimism. We have the conditions and the basis to achieve that. The Chinese economy has huge potential and strong resilience. China is now in the process of a new type of industrialization, IT application, urbanization, and agricultural modernization. This generates enormous demands for expanding domestic demand. China is a vast country and has diverse industries. So the Chinese economy is not supported by just one single factor or one industry. It is supported by multiple factors and a broad industrial base. Therefore, the Chinese economy is shock-resistant and resilient. At present, the Chinese people are now working toward the goal of building a society of initial prosperity in all respects by 2020. This will generate strong power for further economic development. At the same time, China is advancing structural reform which will constantly release new dividends for the economy. China is the largest developing country in the world, and development is of overriding importance. It holds the key to resolving all issues in China. But development, we talk about, must be scientific. It must have quality and efficiency, and it must be sustainable. To achieve such a development, the key lies in reform. We are speeding up structural reform, we pursue an innovation-driven development strategy. In an effort to tap the full potential of our economy, to keep the economy growing at a medium to high speed, and moving to a medium to high level of development. Since the beginning of this year, we have launched new reform measures in terms of fiscal policies, investment of financing and adopted new measures to eliminate restrictions on market access and promote fair competition. We have also stepped up efforts of structural reform. We are advancing reform in the financial sector in light of market principles and the rule of law, and we continue to foster an open, transparent capital market with long-term stability. And we are improving risk management to make sure that regional or systemic financial risks will not occur. We have a high savings rate at large foreign exchange reserves, and we also have considerable amount of financial resources. So there is already plenty of water in the pool, so to speak. So the important thing is to take the full benefit of this large pool of water. We will continue with structural reform to make more efficient use of existing resources and tap their full potential. We will improve allocation of financial resources, raise the efficiency of the financial sector. Recently, while cutting the interest rate and reserve required ratio, we have introduced some new reform measures, and in the next step, we will further relax restrictions on the excess of private capital into the financial sector. We will promote the development of private banks, financing guarantee and financial leasing, and open our financial sector wider to the outside world. This is our set target. We will further... We have improved the quotation regime of IMB's central parity against US dollar for the purpose of making IMB exchange rate more market-based. We will keep IMB basically stable at an adaptive and equilibrium level, and we will also gradually realize the convertibility of the IMB under capital account. Not long ago, we opened interbank bond market to overseas central bank institutions, and going forward, we will provide access for overseas central bank institutions into our interbank foreign exchange market. By the end of the year, we will complete the development of the China International Payment System, or CIPS, to support offshore IMB market. So these are only some of the reform measures we are taking in the financial sector. There are certainly more measures on the list. We will continue with our reform efforts, but in a step-by-step manner. We are determined to move forward with reform, and we will continue to roll out new measures. The purpose of reform is to release new dividends for the Chinese economy. For China, structural reform is to unlock the infinite creativity of the people. Last year's summer Davos, I proposed to advance mass entrepreneurship and innovation, that is an important part of our structural reform. For that, we have taken steps to streamline administration, delegate government power, strengthen regulation, and improve government services. We have also cut taxes for small and medium, small and micro enterprises, and established investment foundations to guide entrepreneurship and innovation, and these major efforts and measures have ignited the passion of the Chinese people, and we are seeing a massive wave of entrepreneurship and innovation across the nation. These involved not just the university students, migrant workers, Chinese people educated overseas, but also corporate managers, technology experts, and scientific researchers, so both elites and people from the grassroots level have participated in this endeavor. Not just micro companies, a lot of major companies have also joined the ranks of entrepreneurship and innovation, and the platforms of crowd innovation, crowd outsourcing, crowd support, and crowd funding have been introduced, thus changing the way of production and management. It allows internal employees to get rewarded by their online creativity and earn an offline salary, and gives opportunity to external makers to take part in innovation and share the benefits. A lot of micro companies have also been incubated in this process. A lot of IND institutions also relied on the internet to carry out joint IND, making innovation much more efficient than before. Mass entrepreneurship and innovation are a strong driving force for development. Creativity is the greatest asset for development. China has a labor force of 900 million and over 7 million college graduates every year, and more of them are now joining the ranks of entrepreneurship and innovation. This has led to new supply and demand and acted as a significant force in keeping growth stable. Mass entrepreneurship and innovation also gives strong support to expanding employment. Though growth is moderating, more jobs are being created because new market entities keep emerging. By streamlining the administration and delegating power, every day now over 10,000 new businesses are still being registered and such phenomenon has lasted for over one year and a half and the momentum is only growing, thus creating a lot of job opportunities. Mass entrepreneurship and innovation also gives impetus to developing a sharing economy. The sharing economy that is now thriving on a global scale opens a new way to drive economic growth. Entrepreneurship and innovation through sharing and collaboration would lower the threshold and cut costs and enable the people to move faster. This helps open new areas for sharing economy in China with more people getting involved. Mass entrepreneurship and innovation represents a major and innovative step in the income distribution model. When more and more people are making more money through innovation and starting up businesses, the role of primary distribution becomes greater, thus a path is opened towards massive wealth creation and common prosperity through hard work and mass entrepreneurship. Mass entrepreneurship and innovation is also effective in promoting social justice. As long as they are willing and capable, all people could establish themselves and lead a promising life through entrepreneurship and innovation. They would all have an equal chance for development and for upward mobility, and all will live a life of dignity. The reason I spent so much time explaining mass entrepreneurship and innovation is because people have infinite creativity. While the Chinese people have great talent and wisdom, the humanity has boundless wisdom. To promote mass entrepreneurship and innovation requires comprehensive and accessible public goods and services. This also requires structural reform. Instead of acting on its own, the government encourages private capital and foreign investments to participate in the D-Deva by encouraging the public to participate in the D-Deva. By encouraging government procurement of social services, PPP, franchising and other market-oriented approaches, we will encourage and guide the participation of private investment in the development, operation and management of public goods and services. In addition, we will relax market access for foreign investments. As a result, a new model of diverse supply of public goods and services will be developed and will be forged. So going forward, we will continue to advance such reform and we will further incentivize various players and do what is necessary to provide sufficient public goods. So as to facilitate entrepreneurship and innovation, promote better economic development and improve people's living standards. Ladies and gentlemen, we are integrating ourselves into the world, and China will open up wider to the outside world. Our policy of using foreign investment will remain unchanged and the specific policies will continue to encourage more foreign investment and expand market access. For example, this year, we have continued to expand the areas available for foreign investment. And cut relevant restrictions on foreign investment by 50%. We have changed the approval system into a record system in a bid to build China into one of the most attractive destination for international investment. The recent volatility in the international financial market has affected global economic recovery. And it has become an imperative for countries to step up macroeconomic policy coordination, maintain stability of the financial market through concerted efforts, and bring the global economy back to the track of healthy growth. What happened since the international financial crisis shows that quantitative easing alone cannot address the structural hindrances to growth. And such policy might cause negative spillover consequences. So what is important is to strengthen the real economy. That requires all countries to advance domestic structural reforms and strengthen international cooperation. Along this line, China has come up with the initiative of the Belt and Road Initiative and to foster global cooperation on production capacity. We believe these initiatives could help forge a more balanced and inclusive global industrial chain that pulls the comparative strengths of all countries and foster a global development community of mutual benefit, inclusiveness, and common progress. Countries are now at different stages of development. Global cooperation on production capacity will match supply with demand effectively and help expand demand through supply. As developing countries accelerate industrialization and urbanization, they now have a strong demand for applicable technologies, equipment, and infrastructure. Many middle-income countries and developed countries also need to upgrade their equipment and infrastructure. However, constrained by funding shortage, some demands have been repressed. Talking about comparative strengths, developed countries have advanced key technologies and equipment. But the demand is limited for their products and sets of equipment at high prices. Developing countries may enjoy rich natural resources and low labor costs, yet most of their industries and products are at the lower end. As far as China is concerned, it has industrial capacity in manufacturing, affordable, middle, and equipment. Its engineering and construction capability is also strong and it has a lot in its foreign exchange reserve. What it needs is to transform and three-party cooperation could combine all their respective strengths and integrate the higher, middle, and lower ends of the industrial chain. It will make it possible to provide equipment and products of relatively high quality with low prices to better meet the needs of various countries, lower construction costs. It would also help countries overcome the difficulties in their development and upgrade their industries. And when it comes to the micro level, there will be more joint ventures and cooperation. This way they can jointly explore both the international and the Chinese market. It's just like a convex lens that makes rays converge. Such a cooperation model could converge the interests of different parties and add new dynamism for steady growth of the global economy. More and more countries developing and developed alike have responded positively to such an approach of global cooperation which they believe will produce multiple benefits and win-win results and China stands ready to serve as a bridge and connects the parties together in this process. We are willing to buy more advanced equipment and technologies from developing countries and combine them with China's more affordable equipment and products to meet the needs of other countries. And we are willing to provide financing support for that. We hope all of you can seize the opportunity locking cooperation possibilities and try new cooperation models. Such cooperation is so wide-ranging that it needs the strong support from governments, international organizations and financial institutions alike. It may be a good idea for parties concerned to strengthen coordination and jointly promote such cooperation by including it into the framework of bilateral and multilateral cooperation. And China is willing to provide financing facilitation to overseas and Chinese companies involved in this process. As long as we work together and join efforts, we stand to achieve a lot in global cooperation on production capacity, which I believe will add a highlight on the new blueprint for global economic growth. Ladies and gentlemen, we live in the same world and we grow in this age of globalization where all have a stake for each other's future and all are like passengers riding in the same boat. Facing the common task of promoting global economic recovery, the international community should work together, increase coordination. As I said yesterday, China will never resort to a currency war. When it comes to production capacity cooperation, there will be some competition, but when we cooperate, we actually have more interests than differences and we will have more cooperation than competition. We need to work together to promote such industrial cooperation and work for an open, comprehensive and nondiscriminatory international platform. We are committed to opening up for win-win benefits and we stand ready to work with all countries for green and sustainable development and build a community of shared benefits and interests so that in this global community we can all share the benefits and together draw a new blueprint for global economic growth and a new and even better future for the mankind and I wish the annual meeting a full success. Thank you. Mr Premier, I think there is one essential message coming out of your speech and I quote you China is not a source for the world. It is a source of confidence, of growth and of opportunities. And you have shown in your speech, Mr Premier, that China has the creativity, the entrepreneurship, the resilience, the fundamentals in place, the reform determination and the vision and the leadership to make sure that the statement of being a source of growth for those a great global partner is not just an optimistic statement it's based on facts. Now, Mr Premier, if you allow me one or two questions you developed in your speech and I think it's a very important global initiative the concept of international production capacity cooperation it has already received internationally good feedback here with the foreign investors in this room I think I may ask the question how can the business community cooperate with you in this respect to make the international capacity cooperation as soon as possible a reality. Mr Premier, in your speech there was a very core message that you mentioned that China is not a risk for the development of the world China is the movement of the world and the source of confidence and opportunity In your speech you mentioned China has the great creativity China's economy and the basic face of China's economy is good so all these give us more information you also mentioned China should continue to show wisdom and develop leadership I think these will ensure that China will continue the growth of the world economy and the cooperation between all the important countries so these are not just the basic things in this room I would like to take this opportunity to ask you two questions first, in your speech you mentioned the important concept of the development of the international capacity cooperation this important idea has led the whole world to meet the challenges there are many foreign investors I would like to ask the question is the cooperation between China and China is the concept of the international capacity cooperation that we have come up with? I would like to talk about the origin of this concept because now the whole world's economy is in place China thinks the whole world especially the whole world's convenience is in place for the benefit of the world on the other hand we want to see more than 70 billion people only more than 10 billion people realize modernization and industrialization and most of the countries are the early and medium of industrialization demand potential the world needs to expand its overall demand international production cooperation this is the reason let me first explain how this idea of promoting international cooperation on production capacity has come up we live in a globalized world and we believe that globalization as well as trade and investment facilitation in all countries in today's world at the same time we also need to recognize that only some 1 billion out of the 7 billion population in our world are living in modernized or industrialized countries and most of the countries in today's world are still located at the primary or the middle stage of industrialization hence we face tremendous potential in unlocking demand and expanding demand in further development that is why we need to tap the potential of pursuing international cooperation on production capacity we need to promote and participate in international cooperation we need to strengthen the common sense trade is competitive but cooperation and co-operation will be far greater than competition we need to grasp the better each country has its own better even in developed countries to get involved in this process of global cooperation on production capacity we believe it is essential for us to all embrace a vision of wing-wing cooperation it may be natural for us to enter into competition in business running but I believe through collaboration we will be able to enjoy more common interests that outweigh the possible competition there may be at the same time it is also imperative that we leverage our respective comparative strengths I believe all countries have their own comparative strengths including the underdeveloped countries but what he uses is a power supply this power supply is bought by Chinese companies to developed countries his navigation equipment is produced by Chinese companies and developed countries together this creates a lower price but high quality quality I believe Chinese companies and Chinese companies have been working together for years we can not only share the Chinese market but also expand because of China's needs more and more at the same time we can combine with cooperation to develop the third market space and opportunity is huge let me give you one concrete example here last year I paid visits to some Latin American countries and in one of them I learned that this country bought several ferry boats from a Chinese company the equipment the ferries was made by a Chinese company but the ferry uses diesel power generators that was bought by the Chinese company the company from developed countries at the same time the navigation equipment used by the ferry is made under the collaboration of Chinese company and companies from developed countries and that has made this product equality yet inexpensive one very popular there has been years of cooperation between Chinese companies and foreign multinationals and not only can we continue to work with each other and exploring the big Chinese market as I'm sure we are going to continue to see steady rise in the individualistic demand in China at the same time we can also work with each other through joint ventures or partnerships exploring third party markets for such cooperation is enormous Mr. Premier it's such a pragmatic and win-win proposition and initiative in the interest of industrialized and developing countries may I ask you a last question if you allow me to in your speech you elaborated how China is implementing a strategy of innovation driven growth and in this respect you mentioned particularly the concept of mass manufacturing and entrepreneurship how can business and particularly also foreign business be engaged into this process and to contribute to the strategy Mr. Premier I think the concept of international cooperation is very realistic and it's a concept of mutual cooperation I think about the country and developing countries I also want to ask you a last question in your speech you talked about China developing strategy especially mentioned in the promotion of mass manufacturing and mass manufacturing in this process to promote this process to make our contribution mass manufacturing mass manufacturing is indeed a reform and adjustment in China because China has entered the level of the middle class although we have a lot of poor people there are also some people who are able to consume they need more products I believe mass entrepreneurship and innovation drive represents a structural reform and structural adjustment for today's China China has become a middle income country we do still have a majority but at the same time we also have a large number of Chinese who now have plenty of money in their pocket to spend and they are willing to spend what they want is diverse choices in the availability of products to meet their individual needs if 30 years ago we had imported foreign products later we greatly imported foreign production lines to form Chinese manufacturing even to promote the world now we have a new demand that is that foreign companies and Chinese companies cooperate to implement the individual needs of the world for 30 years we may have imported a large amount of foreign goods and later we have been importing the production lines from foreign companies and then we have been producing a large amount of made in China goods and these goods have found their ways into international markets but now there is a new rising demand in China that is a big need for collaboration between foreign companies and Chinese companies to meet local needs to come up with more individualistic options of consumption to meet the needs of local customers we need foreign advanced concepts technology especially talents yesterday I was in a space in Dalian to see a new product to record to show a large amount of people who are smart and smart there are some western countries who are smart and smart and at that time he told me I want to invest in this product this process China needs to draw on the advanced expertise and technologies of foreign companies and in particular we need to have greater access to high caliber personnel as I mentioned in my speech yesterday I visited a local makerspace company and I encountered a new product there and they were conducting a road show for their new product for the business representatives from some venture capital companies some of these venture capital companies are western ones and one of them said that he is very interested in this new product and would be happy to make investment in it I believe he brought in not only the shares but also their ideas and technologies but also I can guarantee to all of you that the Chinese government will protect the intellectual property because China's major industrial innovation needs the intellectual property to be strictly protected please rest assured I have confidence that the introduction of foreign partners into this process will not just bring capital but also their own advanced many general expertise and technologies but let me reassure you here that the Chinese government will continue to do its utmost to protect intellectual property rights in China because this campaign of mass entrepreneurship and innovation needs better protection of intellectual property Mr. Premier vision and leadership are the key for trust and confidence in this respect we thank you all for having shared with us your vision and shown us your leadership thank you thank you