[ Nippon Keidanren ] [ Journal ]
Messages from "Economic Trend", August 2007

Now Is the Time for Japan-China Exchange

Chairman of the Japan-China Exchange Year of Culture and Sports 2007
Chairman, Nippon Keidanren

China, now enjoying WTO membership and a more open economy, has achieved four consecutive years of double-digit economic growth. Not only that, China's trade surplus surpassed US$170 billion last year, and the country's foreign currency reserves reached US$1.2 trillion in March of this year.

This growth has also boosted personal income. Per capita GDP in China has doubled in five years, and consequently, Chinese cities are now home to a middle class that is 80-million strong and continuing to grow.

As the Chinese economy undergoes this transformation, policies on trade and the use of foreign capital are changing, as well. China has shifted the principal axis of its economic policy to high value-added goods and services industries, graduating from its past reliance on industries that were labor-intensive, consumed more resources and energy, and less environmentally friendly.

With China undergoing such dramatic development, the recent realization of Japan-China summit meetings, after a lull that lasted years, was very significant. In October 2006, Prime Minister Shinzo Abe of Japan broke the ice between the two countries with a visit to China. Premier Wen Jiabao of China then further assisted the thaw with his visit to Japan in April this year.

These meetings have created an ideal opportunity to solidify relations between Japan and China.

The mutual visits of the Japanese and Chinese heads of state have helped to cement cooperation and dialogue between government institutions. The crux of this collaboration is the environment, the most pressing issue that China currently faces. Both governmental cooperation and joint business are dramatically becoming activated in the environment, energy conservation, and resource conservation sectors.

This year also marks the 35th anniversary of the normalization of diplomatic relations between Japan and China. To commemorate this anniversary, Japan and China are holding events to promote greater mutual understanding at the grassroots level, marking the "Japan-China Exchange Year of Culture and Sports 2007." The eagerness of the people who are participating in these events demonstrates great progress in improving relations between Japan and China.

Total trade between Japan and China comes to more than US$200 billion, and nearly 40,000 investments in China have been made to date by Japanese companies. Today, the two countries are interdependent. The contemporary Japanese economy is inconceivable without China, and without Japan, there is little prospect of solving the environmental and energy conservation problems so important to the Chinese government and people.

This year of exchange provides an ideal opportunity for Japan and China to build a multidimensional, flexible and enduring relationship.

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