 Okay, good afternoon everyone and welcome to this session for the hour which is about resources, natural resources and the increasing demand and need for natural resources for the growing economy particularly in this part of the world. This is an issue which as you've probably noticed as you've gone through several discussions here in Dalian at our annual meeting of new champions and elsewhere that the debate that we've been part of and are helping to host has moved us if you like from a purely carbon challenge perhaps into other areas of food, broader energy access issues, water, other natural resources, earth metals etc etc. So our discussion today is about resources and the demand, increasing demand for business and other users for those resources. I'm delighted to welcome our host to guide us through these discussions, Andrew Stevens of the CNN and he will introduce the panel to you and lead us through this conversation. My name is Dominic Waray, I'm a senior director in charge of environmental and sustainability activities here at the Forum. I hope you enjoy the discussion and we look forward to a good debate. Thank you. Thank you Dominic. Good afternoon everybody. Welcome to the session, the resource discourse very very timely and one thing I've noticed about this World Economic Forum is the increasing amount of time that's been now being given to the resource issue to how to manage resources, global resources as Dominic was saying. This is not just an energy story as we all know this is a water story, this is a food story and the three are obviously very closely interlinked anyway. Just a couple of figures I just wanted to throw out there, you would be familiar with many of these and they do it very slightly but they're all pointing to very much the same theme. Looking at what this globe is going to look like in 2030, 20 years from now as far as consumption and demand is concerned there'll be about 8.3 billion of us on the planet. Now some of the numbers I've come up with is that demand for food will have increased by some 50 percent in 2030, water by 30 percent, oil by 25 percent. All this of course against a backdrop of climate change, more and more extreme weather events are happening before our eyes. There's very rarely a week that goes past as I read the news on CNN that there is not a drought story or flood story or an extreme storm story somewhere in some part of the world. So joining us now to look at this issue and how companies, how businesses actually manage, how do they prepare their strategy to dealing with more demand, more people and dwindling resources. Very distinguished panel we do have today as well. I'd like to thank everybody for joining me up on the stage today and just to my immediate left I'd like to introduce to you Mr. Xi Ding Huan. He is a councillor for the State Council of the People's Republic of China. He has been a very instrumental figure in developing the latest five-year plan. He's also been an instrumental figure in renewable resources and policies for renewable resources here in China. Now next to Mr. Xi is a gentleman who many of you may know, Richard O'Brien. He is the Chief Executive Officer of Newmont Mining which of course is the world's now biggest gold producer, also a significant copper producer as well. On Richard's left we're joined by Wu Chenghua. Xi is the director for Greater China of the Climate Group and this is a group that looks at public-private partnerships in renewable resources in particularly dealing and achieving low emission growth. Next to Chenghua we have Scott Thompson and Scott is the CFO of Talisman Energy which is an energy company based in Canada, diversified upstream oil and gas group, operates in North America, the North Sea and also here in Asia. Next to Richard, Muhammad Jafar. Muhammad is the chairman of the Kuwait Danish Dairy Company. Now KDD is a leading manufacturer and distributor of food and beverage products in the Arabian Gulf and one question I will put to Muhammad is how does one produce milk in the desert, in the quantities that they are doing it. So with that I'd like to start Richard if I can with you because I know at this conference you and your peers have been meeting at the Mining and Metals Institute Group. Now this is obviously a group of peers, you are looking at strategies of dealing with use of resources, production of resources. What was the feeling there about sort of the world in 30 years and how it's going to look and how you're going to deal with it? A good question though and I think at the resource summit, this is the third resource summit that the Board of Governors has sponsored here and that resource summit we covered a couple of things so let me just a couple of quick points. First we were asked a brief question yesterday which is do we think that resource nationalization is going to occur in the near future and amongst a group of about 20 people the unanimous answer was yes. The next question was do we think that's a good thing? The unanimous answer was no. So the growing burden on the world for development, production and consumption of resources I think is really going to put to test a number of relationships that we have around the world and so the great thing about the World Economic Forum is if there's a problem we're going to try to figure out what the solution is and as mining companies were no different give us a hill we'll figure out how to take it down that's what we do but I think as we approach that one of the things that we really are focused on is something that we look at which is the resource development initiative so we have a responsible mining development initiative that we're actually sponsoring around the world and what's that about it's about trying to create an atmosphere where we can bring more production on in association with communities and governments in transparent ways so that we can actually meet the needs of the world through mining by actually working forward transparently and with communities so that these mines are actually sustainable so moving from mining curse to mining benefit and I think without that engagement that kind of engagement I think that we'll be unable as miners to really meet the resource needs that we have around the world so how do we do it sustainably and responsibly and I would just say for those who are interested we've actually have a set of some of the work that we've done back both in Chinese and in English in the back on the left hand side as you go out we have a couple of brochures that we put together we're actually trying to solve the problem here not just create the problem and I think that that's part of what our initiative is about and I think it's terrific that we have a group of mining companies involved in this kind of forum where we're actually trying to work those problems so again I think it's about access it's about ensuring that governments don't feel the need to actually take assets back and nationalize them but to actually put them into production in the best way possible so taking pre-emptive action in other words about involving more stakeholders the local communities this is that you're a listed company what do you think that is going to mean for for profits for shareholders because that's what drives a lot of mining companies at the moment yeah great question Andrew what I would say is stocks are valued partly on profits and partly on discount rates so what are the two things you have to work drive profits up reduce discount rates so is there going to be an impact in terms of addressing these issues financially absolutely there will be a cost but I think the benefit comes in the form of a lower discount rate because people don't have to associate political risk and the outcomes that we don't like mine stoppages employees who are dissatisfied communities who protest we actually have a lower discount rate that we can apply to our our stream of cash flow because we don't have to worry about those vagaries so I think that's the positive just a very quick one Richard is there enough resources on this planet what as Muhammad said to me earlier that one of the quotes from the world economic forum was if everybody's going to start consuming like Americans and Europeans consume that following that consumption model in 20 years time we're going to need three planets to produce it all yeah I think that's a difficult question but I'd answer it this way which is I think it's we have amazing innovation taking place in the world every day we have amazing I think ideas around the world and we have a stick to this particularly in this industry that we will figure out a way to resolve it so I would say can we meet the needs yes what's the impact of that prices are going to go up at some point but our goal I think is to try to hit that mechanism of the market so that we do that right so that people can anticipate that they can react to it and then to the extent that they choose to reduce their consumption by consuming less energy I think that's where the parallel will come in so we're all going to have to work to meet the needs but I believe that we can find the resources it's going to be difficult as if we don't overcome with technology and innovation on what we do today I don't see enough resources to satisfy the world I just have an optimism that I think there are other things that will accomplish that we just don't know today that's an optimism that's been shared by Scott Thompson because so we're speaking about this and innovation in particular Scott Talisman is a big gas producer just tell us the story of innovation in your experience yeah I I mean I agree with with Richard I think there's a resource scarcity issue especially as you look at food and water energy however what I would say is I think you're seeing innovation you know throughout the world and particularly in the energy sector so if we look at North America for example over the last five years I think in the last two decades we thought there was about 1,000 trillion cubic feet of gas and that's pretty been pretty consistent over the last two decades in the last five years that's been up to 3,000 to 4,000 trillion cubic feet of gas in terms of resource because of innovation and the commercialization of shale gas five years ago there was zero product zero natural gas production in in North America was from shale gas today it's about 25 percent by 2020 it will be about 50 percent of natural gas consumption does that does that increase reserves then is that easily enough to cover your projected demand if those figures I quoted that's a good point those figures that I quoted would would meet the needs of North America for the next 100 years so from a gas perspective North America has gone from chronically undersupplied or this discussion about scarcity to a situation where abundant supply low prices economic development and in fact thinking about exporting gas off of North America and I think this has huge implications one for North America but also for Asia because as you think about the five-year plan that was just laid out and the movement away from coal to renewables or more sustainability movement away less from greenhouse gas emissions natural gas has a place Asia and China in particular has unconventional gas reserves I mean it's very well known that those reserves could be developed here so I think natural gas has a place in Asia and the discussion around scarcity may actually move to one of abundance from a national natural gas perspective now that's not the same necessarily in water and food and as we know natural gas development takes a lot of water and China doesn't necessarily or Asia doesn't actually have a lot of water so there's inter linkages between between the different resources I would say one other thing too innovations one thing also energy productivity is another thing and I think we as a society is that the same as efficiency efficiency productivity efficiency I think we as society will find ways to do things better so whether it's consuming less food less leakage whether it's through water less like leakage through cities I mean there are lots of things that we will improve on over the next year so I'm optimistic that although there's a scarcity issue we will be able to deal with it well and less consumption as well would you say less consumption as well so so you're really you're both saying that we we will have to moderate our behavior our own consumption patterns ask both of you quickly radically or moderately do you think to ensure an adequate supply for all difficult question at this stage you would say it's a matter of just making sure you do sort of basic energy sort of initially turning lights off and things like that or is a bit more than that only one car only I'll go first I think probably medium radically and what do I mean by that I don't think it's necessarily going back to to no lights you know no consumption I just don't see the world changing that way but I do think it means that people need to pause and figure out what do I really need to do how can I eliminate those inefficient things whether it's at work or in my life that really don't incrementally add to the value so I do think that that has to change and I think that kind of thinking happens through price mechanisms so prices go up people consume less I think it also comes through communication and awareness and I think those have to improve radically so price mechanisms around the world need to stabilize subsidies I think need to go away over time so that people get exposed to the real cost and I think when that happens then I think we're going to see more immediate response to price signals and then I think the communication piece I think we do need to talk to people about how long does it take to develop and what are costs going to look like if you don't choose alternative actions again more visibility so people know what to expect yeah I agree with that I mean I think it will be moderately radical that was perfect term you know you think about 18 million cars per year in China coming on to onto the roads I mean there's going to have to be some radical decisions in terms of energy efficiency in that front also in North America in terms of moving from coal to natural gas for power generation I mean that takes policy that takes forward thinking that takes vision and I think you'll have to see that throughout the world in order to to meet the energy needs okay Muhammad if I can turn to you we talked about energy mining food before we start if you could just enlighten us how you do make milk in the desert right thank you obviously you could you could have farms and you could do it the traditional way or you could orange groves to have juice but we don't we don't do that we basically import the milk powder from New Zealand or Australia where there is plenty of water and recombine it in Kuwait Kuwait is one of the poorest nations when it comes to water might be rich in oil but you cannot drink oil and you cannot feed it to cows so this touches on the issue of innovation and how do you deal with the scarce resources that you have so if you don't have the resource you obviously cannot waste it and you find innovative ways of feeding people in in remote areas that are cost effective and that also kind to the environment but this drive it was in the DNA of the model that we adapted I think increasingly as you know to use your example of the web's publication of the increasing stress on the resources of the planet the prediction is that by 2030 if consumers the middle classes in China and in India consumed demanded what Europe demands today that you'll need three globes and if they consume the way America consumed it would be five globes now we simply don't have today with the current management practices we don't have the water we don't have the land that would supply all this this food so where do you find it and the short of one point is if you if you start managing your water resources if you start economizing and optimizing on how much food you eat how much waste there is whether from the farm level or in storage or at home even if whatever food is left in a hotel or after this conference you send it to be recycled and turned into fuel if you did all of that would you would you have the resources necessary to feed people and we must remember that as we speak today there is a crisis there are people who go home hungry and those are the farmers who are growing the food that we eat so I think can I just interrupt how do you yourself how do you prepare and and to to meet you live in a in a part of the world which is also rapidly growing becoming wealthier people demanding more populations rising you have as you point out very scarce water resources so how do you meet your projected demand for something which is obviously so water intensive well the issue is there if you decide not as a country as a nation if you decide to rely on another nation for your crops if you say well I don't have the water to grow wheat or to grow any food at all I will rely on imports for that purpose you're exposing yourself politically yeah because if there is a shortage in oranges in Brazil or if the Indian government decides not to export basmati rice and your people rely on wheat then basically you've created yourself a nice problem but these are if you don't do that then if you go the route that Saudi Arabia my neighbor followed Saudi Arabia grow grow wheat for the longest time and exported it to Egypt but I mean for many countries there's no alternative is there you have to import well you can grow I mean if you look at Holland for example today a lot of food that is sold in supermarkets across Europe is grown in greenhouses in Holland now you look at the carbon footprint of that and you start thinking as a consumer as a citizen as a regulator you say well what is the footprint of importing that from Africa creating jobs there compared to the cost of fuel the transportation because that will be its carbon footprint compared to saving on transportation and growing it locally I think consumers increasingly think that way or they may not be able to crunch the numbers that may not be readily available to them but I think there's a general awareness that things cost in environmental terms more than what you're paying for them and I think this will be so the price is wrong at the moment we need to you need we're going to see a more realistic sort of form of pricing on food do you think yes but when when the prices rose in in Egypt a few years ago there were riots and they had to call the police the army to the streets and to run the the ovens the you know to make bread so it's easy to say that you know the markets will regulate themselves and they will however there is a price there is suffering that will come in the interim and that has to be taken into consideration it has to be expected okay mr. she if I could turn to you we've heard private sector issues and and how we could deal with scarcity issues you've been involved in China's energy policy if I can term it that how does it how is the government the Chinese government dealing with the fact that you have an enormous population not a lot of natural resources and increasing demand from a rising middle class how do you frame your policy to meet all those different issues the countries that is facing severe resource scarcity with the increase of the population with the urbanization especially accelerated urbanization in terms of water mineral resources China has seen a growing demand against this background China has launched energy efficient and resources conservation policy we have made this policy of a national policy in terms of energy we have put forward the goal of energy conservation and emission reduction and we have incorporated it into our overall social and economical development in terms of water resources we have aimed at increasing the efficiency of utilization we have identified the policy goals and we have mapped out some constraints on the local governments and the businesses we have break down the overall goals to the businesses and the local governments I want to emphasize that against the background of rising demand for resources and China consumption of petroleum has to be as high as 50 percent with the increase of the car ownership the consumption of petroleum in China will further increase in such circumstance what should China do China has turned its attention to renewable energy including the wind power solar power biomass and geothermal energy those energies are renewable if we look at other countries experience those resources can satisfy the long-term needs of the humanity in the past we have a limited technology to explore those resources as a result to those resources failed to take a big share in our energy consumption structure however in order to cope with the climate change and to address the energy scarcity issue renewable energy has become a priority it has become a strategic field and with the advance of the technology renewable energy can enter people's life renewable energy can replace the forcible energy I have been working in the government for 30 years I have witnessed the involvement of China energy policy in 1970s after the oil crisis the government proposed the development of renewable energy however due to the low price of petroleum the renewable energy did not develop the lifts and bounds however in the new century people have already had a deeper understanding of the climate change it is an inevitable country so we are shifted to renewable energy and Chinese government has identified the development of renewable energy a priority area in the past decade the renewable energy has enjoyed remarkable progress China has developed a legal framework and a policy framework as well as favorable policies for the renewable energy the cost of renewable energy has been cut dramatically take a solo energy as an example the cost has reduced from dozens of yuan per watt to 10 yuan per watt in the past the price of the ungrateful it was a full year and people still think the full year was very expensive the price has already been reduced to one year and now people think that the ungrateful price of renewable energy of one year is acceptable and it is the same case with the wind power so my point is that renewable energy can be used on a larger scale in China you're saying that renewable energy is now commercially viable in China or does it still need government subsidies to survive currently renewable energy has enjoyed great development forever renewable energy still occupy a relatively low proportion and Chinese government has proposed that renewable energy should take a share of 15 percent I think to achieve this goal we need the government policy and also we need to boost the technology innovation to increase the competitiveness of the renewables in from the long-term we believe that they will be able we're able to provide the renewables at the comparable price of the conventional sources but the current they will still need the support from the government that is necessary support coming from the government it is necessary very can I just ask you then we just ask part of the world probably you know has different market situation everything like that in China in particular I think that has been the practice has been the norm and partly because actually if you look at major resources natural resources as well as energy sector who are the biggest players from the business community in most cases they are state-owned companies so of course you can claim state-owned companies they are sort of a part of the government whatever stuff like that so to large extent you know addressing the resources food water energy all the issues in China already the public private partnership is already in place that has been playing a very very important role there and then the question of course to say yes we do have state-owned companies but also we have sort of increasing private sectors there as well are there you know good models as you know to actually you know in those kind of strategic sectors I think it's been sort of involving process involving a way I think traditionally private sector in most cases of course in the beginning their skill was limited their capability was limited so they they didn't really have a big role to play in those resources strategic sectors not in a major way probably in some kind of niche kind of markets along the value chain that sort of way but gradually over the last three decades or so the private sector in China has been growing has been really growing up very very fast and some of them already actually if you look at the size of those companies revenues everything like that they're already regarded as large companies already they're not state-owned and in the meantime actually if you look at the government policy side from the public part and because you know the growing part of the private sector because their expertise experience because of the wealth of the capital accumulated in the private sector and also more and more so now with the capital need actually for the strategic areas so the government started to relaxing sort of control over those strategic resource areas and started to inviting basically those private sector capital into those strategic areas so I feel confident I think it's been successful that they well again actually depending how you define a successful I think it's a process step by step this is just emerging just starting now it's hard to tell how successful that's going to be I don't I haven't really done any systematic assessment at this moment but it's encouraging to see that kind of trend rather than say everything on the strategic resource areas controlled by state-owned companies actually private sector private capital more and more so started to have a role to play one important element in there say why you need more private sector private capital involved I think this is sort of innovation there we all recognize actually private sector happens to be really the innovation leaders that's every economy needs and that's the area I would look forward to seeing actually more and more so reflected in those strategic resource areas so you think PPI is the ideal model as opposed to all state or all private again as I think ideal the word itself is hard to define what do you mean there's nothing perfect in this world everything just to learn you build up the partnership you know work with each other maybe in the beginning early stage there were a lot of bumpers stuff like that you have to deal with but gradually I believe it's a must it's not like we you know dealing with the issues we're talking about today it's not just the government can solve the issue it's not just the private sector or the business community can do it it has to like all the pieces of government business and also the public we all have to come together in order to solve the issue now Richard O'Brien having more government involvement in the US is anathema to many people as we're certainly hearing about what do you think the US could and should learn from China's approach to resource management to renewables well I think just over the last couple days I think there are several things talking to some of my US colleagues my mind may be a minority view but I think that the US government can learn several things from China I think we can all learn things from China and I'm hopeful that it works both ways but in short to manage resources I think it takes a plan as a CEO I'm held to a plan every year I've got to be able to deliver I've got to execute I think politicians their plan is to get reelected and I think as long as that's their plan execution doesn't matter and I think we have to enforce that execution matters and when we do that one of the things that China does very well is I think this 12th five year plan I can't think of one five year plan we've had in the United States we haven't gotten it right once I don't think if you have a will in an established way think to the point you were making if government doesn't lead citizens don't really know where to follow the one thing good about the US is if the government leads and gets the heck out of the way we'll get her done as industry and I think as citizens and I think so the main thing that I would look for is more leadership as they have here I think the premier smoke spoke very well yesterday about establishing targets holding people accountable incentives related to how they actually perform in the regions how remarkable would that be in the United States so I think there's a lot that we can learn in short Scott if I mean talismans canadian can and can as political model seems to be working a little bit better than the US model at the moment what do you see as the role of government in how would you want to see them involved if at all well I think I agree with Richard I mean listening to the premier speech on Wednesday morning and hearing the clear vision and a clear path forward on renewables I mean clearly renewables are going to play a large part in the future going forward I think the issue right now is without a price on carbon they don't compete with fossil fuels and that's why you need government subsidies etc and if you're going to make some of these moderate radical switches you're going to need government leadership and right now in North America and I think in the US in particular you've you haven't seen the political will to take some of these important steps from a leadership perspective and vision and I think that's something that you know I'm hopeful that we can learn from from from from China Mohammed just a quick comment I've taken note of Mr. she mentioned that 15 percent of the policy of the Chinese government is that 15 percent should come from renewable energy compared that to America's policy by 2020 I believe they want to achieve 20 percent from biofuel this was the last administration's policy which is being continued so there are different ways of looking at energy security there are definitely common grounds of course but there is a policy in America it's just different from the one in China I should like to stay with you Mohammed and want to move the conversation on coming back to food for a moment genetically modified food GM food this is not a new thing in many parts of the world including as I understand the US it's it's quite common but in certain parts of Europe it's still looked on with with with virtual horror there's no doubt that it's effective is it does it have to be the future of food production to meet coming demand I think it's a controversial issue which is a lot of time ignored it's on the table I mean if you go to America you eat genetically modified food you eat it in other places most of the soya that we use is genetically modified in China genetically modified foods are available I believe I mean you can push it to the limit I understand that you can produce milk now using cows in China produce breast milk for infants rather than feeding them cow milk the science is there do you trust it is the question and do you need it these are issues that scientists cannot answer but that society must answer but do you think it is an essential part of growing the food production or is it efficiencies I mean we spoke about efficiencies in in in other areas but there's a huge amount of waste in food still I mean India is a good example of how much is lost between the farm and the and the shop I think it's a matter of choice at the end of the day you cannot force people to consume what they don't feel comfortable about anymore that you can force them to consume a medicine that they're not comfortable about there is myth there are fears which are based on reality others that are not consumers in general don't trust anybody these days they don't they don't trust regulators they don't trust business they trust themselves and sometimes they don't have the knowledge so you have to deal with that to answer your question as to whether genetically modified foods are good or evil I think they can be good I think the necessity for regulation is important to make sure that we are not um over relying on science and um they should be challenged with their safeguards and interactions you know two medicines on their own can be very good for you together they can be a lethal cocktail is the same true of genetically modified foods or not it may be irrelevant I think people should be entitled to ask questions science is going forward anyway but whether this will solve the issue of scarcity or not whether in the Philippines for example they take rice and make it you know resilient to disease or in Vietnam to salinity perfectly safe they say they claim it's tested the next step where where further do you go and the more complex it becomes who regulates and if it's in the hands of recognized countries what if it becomes available to countries that are still trying Libya you know which scientists do trust and how how do you control it these are issues that societies they just have to be discussed and I noticed that you know in many meetings on food GM is not addressed it's people shy away I think it should be brought to the surface it needs a bit more light can I just add a further comment on the trust issue I think that's a deeper issue which might not have been just covered actually at this forum here I mean like it's getting more and more universal just imagine food is one and just Mohammed was mentioning but also actually in other sectors as well you asked me about the partnership what's the basis foundation for partnership it's a trust right if somehow the government doesn't trust the business the public doesn't trust the government or business whatever so there's no foundation there at all to talk about any trust yes we can talk about innovation talk about technology everything like that but really fundamentally if that's the trust apart is missing it's going to be really really difficult for anyone to drive any agenda into this world and and to get trust you must have transparency is there transparency enough do you see in the ppi's that are happening in china right now because there is obviously issues in china about corruption well again actually transparency is absolutely one of the very important tools actually to increase the trust of there but in the meantime actually so there is also truth in it right who do you listen to what do you mean transparent what's being disclosed you know if this again actually behind that there is a trust issue there's so much information out there today it's not like we don't have any information there but what kind of information who are the people sending out the information stuff like that if that process is not well developed or built I think again it's going to be difficult even though you say yes we we can have a transparency it still doesn't solve the problem yeah I'd like to bring Mr Xi in here you are nodding there but is do you think more transparency is needed in china's model to to make all because there are very big plans in china they're very impressive plans but cannot be delivered under the current conditions or do you need more transparency more implementation more policing of of corruption issues that sort of thing to have a fair and harmonious society I believe that the transparency at the government level is an absolute necessity this is all what the way the government has been promoting and we are trying to improve the transparency to make it and to process the transparent to make it really to to allow the participants and the general public and the businesses to to make them monitor what the government on the other hand it's very important to create this trust system in the society to really improve the overall quality of the general public and there is another important element in this in this in the process of establishment of the trust trust for society so we need to have take a both bottom up and top down approaches to get to the trust for society and from the the the transparency be established at both government and the corporate levels approach from the government down are you happy there is enough transparency or would you like to see more effort being directed into opening up how the levels of government are working during the process of transforming the function of the government this is a target for the government the china is a steer in the process of transforming its function it is fair to say that the china is transforming and learning from other countries at the same time the government should take into consideration our national conditions because china is a special china is such a big country we cannot blindly copy the practice of other countries we should apply what is suitable for china we're rattling along at a great pace here but I would like to ask if there's anyone from the floor who would like to join the debate join the conversation if there are any questions if you do just raise your hand and if you could just state clearly who you are and which organization you're with at this stage is there anyone who'd like to join discussions so over here action ventures the renewables discussion was was kind of a big part of this today for resources and that requires innovation and also we talked about the premier's comment yesterday and I was struck with a china beginning to think more about innovation and with a planning culture how people would think about planning innovation mr. she would you like to would you like to answer that question how with this increase in innovation in china how do you plan for that have been working with the ministry of science and technology for quite a long time by developing the medium and the long-term development plan we emphasize that we should transform the development pattern that is to say we will shift from the resource intensive development to the technology driven development we have identified the goal of innovative country we have development the policies and for example we have emphasized that we should increase the capacity of businesses in terms of innovation including both the SOEs and SMEs and private enterprises and we have also launched the human resources policies for example we have developed policies to attract overseas talents and in the world we have developed various kinds of plans under the director leadership of a premier one we have organized tens of hundreds of scientists including the scientists in economy and social sciences to carry out the development of a plan through planning we have identified the measures to help us to achieve the goal in the medium and the long-term development plan and apart from the long and medium term development plan we have mapped out a five-year plan we have formulated the plans to address the challenges in current China as a society the Chinese government will increase the government input and we will mobilize the private sectors we have encouraged the development of incubators found and GEMs to increase China's capacity in innovation in the past 10 years China has made remarkable progress in terms of innovation or at the same time we should be fully aware that China still has a long way to go China's innovation is not isolated ice is not isolated isolated one we will increase innovation by learning from other countries we have actively participated in the international plans we have joined hands with the United States Japan and another five countries to launch international plan in nuclear power development I think Mr. Xu has pretty much give the outline of the overall strategy to answer your question does I think that's a very well answered I even appreciate that the only thing to add China this is sort of about the human talents Mr. Xu mentioned actually at the national level we do also have plans about human talents sort of plan we even have a long-term 10-year plan for human talents human talents not only just educate or train them domestically but also really recruiting talents internationally so just that's another thing I want to add into that process I remember actually some of my American friends a few months ago I was in New York and we're having dinner and so we're talking about China and about China's 12-5 year plan and those friends pretty much really familiar with China how China works so we talked about a competition issue and a couple friends basically said very very frankly say how could we in the US compete with China China is literally running the world largest company the way actually we're running this country we pretty much plan everything actually that's a sort of perfect way to do it but somehow actually that's a sort of the way the thinking actually dominating see how we manage this country and in their R&D technology innovation is a big part of it Andrew Andrew one thing sitting in Canada I would say we've seen a significant increase over the last probably five or six years and in Chinese companies coming to Canada to try and partner on the resource side so whether it be in the oil sands or whether it be unconventional gas there's been I would say a very big increase in activity from Chinese Canadian partnerships just very how does that work is that a is that a cross stake holding thing or is it just a an understanding no it'd be an economic relationship so for example there'd be partnerships between minority typically minority partnerships where a Chinese company would own 30% or 40% of a venture the Canadian or US company where it maybe would provide some of the innovation of the learnings and the Chinese company would provide some of the capital with the full intent presumably to bring some of those learnings back to China have you excuse me yes I want to add that in terms of in the field of innovation China pay great attention to the production of intellectual property rights some foreign countries are worried that their technology will be stolen by the Chinese companies I think the production of IPR is a basis and China is improving the production of IPR by um perfecting its legal framework I think the production of IPR is very important for international cooperation and China is actively participating in the development of standards because standards are very important for the industrial cooperation especially in emerging and industries China I want to have for more sake that is obviously a very hot topic across all areas of industry and China does not have a good record on that now you are saying it is it is improving perhaps Richard or Scott obviously this is a very sensitive issue IPR and China's some would say contravention of IPR acts would you say there has been an improvement in IPR protection in China I mean you may be the wrong person to ask saying you're in the mining industry but Phil I'm curious I may very well be the wrong person to ask but I'll venture an opinion I always have one from what I read and from what I've heard I think that China is making progress in this area I think the fact again that they ascribe a goal to this that they have mechanisms now to try to get there and some visibility into this I think are great first steps that's my opinion but take it as that an opinion okay okay um there was a question down down here from the floor the gentleman in the in the shirt just in the second row thank you here I'm Arun Sen from Lanco International we're an energy developer and so my question to the panel and comment is related to the the issue of what happens when China and India and other large emerging markets catch up to the west in terms of per capita consumption of energy and I think your panel touched on this earlier and I was happy to hear the optimism of of Mr. Bryan and Mr. Thompson that the producers will find ways to meet the demand um my concern actually is in terms of what happens if India or China and China Brazil do not catch up to the west in terms of energy efficiency of their economies today in terms of energy consumed per unit of unit of GDP produced India and China are on the order of three or four times less efficient than the US or Europe and if these countries continue to consume in the way they have will you be able to catch up in terms of production and innovation if they don't change their policies and introduce market influences to increase the efficiency of production interesting question two two questions there really one for Mr. Xi what is China doing about energy efficiency to if it's not going to work how do the producers cope I would ask you if you could keep your questions quite short because your answers quite short we are we are getting short of time now and I'd like to try and get a little bit more in if I can so first of all Mr. Xi Chinese efficiency in usage of energy how bigger focus is that in China in terms of energy efficiency China has identified it as a priority in last five year plan the Chinese government has fulfilled its commitment to break down the target to enterprises and local governments we have accomplished the goal of 20 percent energy efficiency increase we actually we the actual figure is more than 19 percent 19 percent in China's energy consumption industry transportation and the government as well as utility consumption occupy a quite large proportion in the next five year plan energy efficiency will still be on the top of our agenda it is a mandatory target the governments will be hold accountable for fulfilling those targets just as this gentleman has said if we do not increase the energy efficiency we cannot meet the demand of energy consumption we have increased China's energy efficiency however we still cannot catch up with the United States if we do not use increase the energy efficiency we will require several planets the demand side we will improve in the next five year plan pricing reforms and innovation and you can you would be able to cope you know I think it avoids the crisis in the near term but just innovate I don't want to leave you the opinion I just think you can innovate your way out of it I definitely don't think you can I think you're going to need energy efficiency and pricing reforms is a good point I mean I'm a big believer in pricing solves a lot of things and clearly we haven't figured that out globally frankly in a lot of areas yeah and I don't believe I don't have the optimism that producers can meet every need every day I actually think it is a balance I think Scott's exactly right can I I would like to challenge the view I think actually this question has been repeated at least in the last decade or so in my professional life actually that's always been repeated to the questions always remains have we solved the issue now I don't think if we continue to say concerned about say what if per capita energy consumption from China India will you know catch up with the US I don't think we are we are talking about efficiency we're talking about alternatives I still don't we have the way out rather I would take another maybe two or three steps back asking some fundamental questions why do we need this energy why do we need you know where do we use them for instance from city management perspective do we understand the flows of the energy stuff like that if somehow we could go back to really the fundamental the basic part understanding the needs why all this wise and then in that process trying to figure out what are the best or whatever the most effective technologies to deploy I think probably there is a hope there if we continue to ask questions like that which we keep asking we do not solve them I really don't see the magic there basically to get out of the process and I think that's a global question to ask not just a Chinese question to ask and I think that's a perfect way to end this discussion global questions questions do need to be raised we have extended our a lot of time a little bit but not too much they'll take one more question without looking yes sir quick very quick one my question to Mr. Xu you mentioned that the mid and long-term energy plan in the Fukushima nuclear accident the Chinese government has has a safety review for four months already this exercise has come to the conclusion whether this review has an impact on the this new approvals of the new projects and the nuclear project we believe that the nuclear development for the 12th five-year plan period whether the 14 million kilowatt target is the very big ambitious project target I believe that the Fukushima accident is a huge has a huge impact on the nuclear power industry because China is in the is is developing the nuclear power and so we do we and the whole industry is really affected by the incident but on the other hand we should say this is a good lesson to be learned then then we really need to enhance the importance of the safety within the nuclear power industry we hope that in the future when these reactors are built we are able to meet the higher standards in terms of safety and security but still that could bring some impact on the 2020 target original plan is the 20 gigawatt I believe that the target might be compromised and the gap should be met by some clean energy and some other renewables so that the 15 percent share could be fulfilled but still the nuclear power as the ingredient of the clean energy will continue to be developed I will continue to tap the potential of the nuclear power thank you very I'm afraid one hour obviously is not nearly long enough to do justice to an enormous topic and a topic that will affect us in a very direct way for the rest of our lives but I would like now to just to thank our panel for joining us today ladies and gentlemen it's been enlightening for me I hope it's also been enlightening for the audience as well and thank you very much for your time