President Estrada,

Dear Colleagues,

It is my great pleasure to be invited to attend the Third Informal Meeting of Heads of State/Government of ASEAN, China, Japan and the Republic of Korea. Please allow me to extend my hearty thanks to ASEAN and to the host country, the Philippines, for their warm hospitality.

The Informal Summit of ASEAN, China Japan and ROK is the only channel for leaders of countries in this region to meet with each other and exchange ideas on East Asian cooperation. The previous two meeting have enhance our mutual understanding and brought about important consensus on enhancing East Asian cooperation for the common interest of people of all countries in this region.

I believe that, at the turn of the century, it is essential for this meeting to build on the success of the previous two meetings and further identify the objectives, principles and areas for East Asian cooperation oriented towards the new century so as to ensure that such cooperation continue to move forward along the right and healthy track.

In early 1980s, Chinese leader Deng Xiaoping drew the conclusion with a far-sighted vision and a keen insight into the situation that peace and development are two major subjects facing the world today. The evolution of the world situation since the end of the Cold War fully testifies to the correctness of his judgement. Be it in the world at large, or within our own region, the issues of peace and development are still awaiting a final solution. To maintain peace and boost development are the common aspiration of people of all countries and also the purposes and objectives of East Asian cooperation.

East Asia is a region of daring diversity in today's world. Countries in this region differ in terms of national conditions, social systems, cultural traditions and levels of development. However, to concentrate on economic development and create a more peaceful environment are where the common interest of East Asian countries.

At present, East Asia is under the double pressure of overcoming all the negative impact of the financial crisis and meeting new challenges accompanying economic globalization. How to advance economic cooperation, promote common development and resume the momentum of growth is the primary task for East Asian countries. One profound lesson we have learned from the Asian financial crisis is that it requires the persistent efforts of all countries to press ahead with reforms and economic readjustments at home and further strengthen coordination and cooperation between us to get the East Asian economy out of the current dire straits, achieve development through cooperation and bring back the momentum of development.

In a fairly long period of time to come, East Asian cooperation should focus on the economic area. To be specific, it is essential to further enhance cooperation between East Asian countries in the economic, trade, financial, investment, scientific and technological and other areas. As East Asia may become one of the assault targets of international capital and in absence of a rational international financial system and a full-fledged financial supervision and regulation system in regional countries, it is still a heavy task to guard against and prevent financial risks. In this connection, financial cooperation should be one of the focuses for the current East Asian cooperation.

It is gratifying that there has already been a good start for East Asian financial cooperation. Last March, the ASEAN-China Japan and ROK Dialogue of Finance and Central Bank Deputies, which was proposed by the Chinese side, was launched successfully under the auspices of ASEAN. By far they have met twice and had useful discussions on how to monitor and regulate the short-term capital flow and reform the international financial system.

It is imperative to strengthen and deepen this effective dialogue mechanism. In this connection, the Chinese side wishes to advance the following proposals: First, to institutionalize the Meeting of Finance and Central Bank Deputies, and convene meetings of finance ministers and central bank governors on basis of the deputy meetings, if necessary. Second, to share information and experience on financial reforms readjustments in their respective countries within this mechanism and to set up an ad hoc committee for an in-depth study of the supervision and regulation of international capital flow, the improvement of capabilities of guarding against and forecasting financial risks, the restructuring of the international financial system and other questions. Third, to coordinate positions and stances of East Asian countries on major international financial and economic issues through this mechanism so that East Asia may do its part for the reform of the international financial system.

In addition to that, East Asia should also pay attention to closer cooperation in the hi-tech area. From a long-term prospective, this carries important significance for economic restructuring and industrial upgrading in East Asian region. In order to facilitate a shift in the mode of economic growth in East Asia to that of relying on scientific and technological progress, it is imperative to give a prominent place to the scientific and technological cooperation. In this connection, we find it advisable to set up an ad hoc committee to study such issues as how to increase scientific and technological exchanges, develop human resources, rationally transfer industrial technology and achieve a sustainable development in this region and provide guidance accordingly. This will help ensure that scientific and technological cooperation meet the development requirements of the countries concerned and hence improve the competitiveness of East Asia as a whole.

Lessons from the past have told us that regional or international cooperation depends on stable and sound state relations. Asia is one of the cradles of human civilization. In the coming century, East Asian countries should continue to promote the fine traditions of the Oriental culture, develop state-to-state relations strictly in accordance with the purposes and principles of the UN Charter, the Five Principles of Peaceful Coexistence, the Treaty of Amity and Cooperation in Southeast Asia, and other universally recognized norms governing international relations, and engage in cooperation in various fields according to the principles of participation on an equal footing, reciprocity and mutual benefit, complementarity and common development. This is the only way to accommodate the different rights, interests and requirements of all countries properly and advance East Asian cooperation steadily.

The Chinese side stands ready to exchange views on political and security issues of common interest within the framework of East Asia dialogue and cooperation. Such dialogue should be conducted in the spirit of mutual respect and seeking common ground while shelving differences and should be aimed at enhancing mutual understanding and expanding consensus, rather than highlighting or playing up differences over some specific issues. Thanks to the efforts made over the years, East Asian countries have enjoyed an ever closer and better relationship

between them and a growing momentum of cooperation. All this has not come easily and we should cherish this all the more dearly and do our best to protect the newly unfolded East Asian cooperation from any interference and keep this process from drifting away from the right direction.

China cannot develop without East Asia, neither can East Asia prosper without China. As a member of East Asia, China attaches great importance to increased cooperation with other countries in East Asia.

China's political stability, economic development and social progress constitute the most important contribution China makes to the development of East Asia. After fifty years' hard work, China has made tremendous achievements in her socialist modernization drive and decisive progress in the economic restructuring, obtained sustained, rapid and sound development of her national economy, and all-round prosperity of various undertakings such as science and technology, education and culture. The Chinese people have enjoyed a much better life, the socialist democracy and legal system have continued to improve, and the unity of people of all ethnic groups across China has been further consolidated.

China has worked vigorously for the stability and development of East Asia and the entire Asian region as well. Despite many difficulties it faces, the Chinese Government, in a highly responsible manner, has made efforts to stimulate its domestic demand so as to ensure economic

growth; and adhered to the policy of a stable RMB and provided assistance within its limit to the crisis-affected East Asian countries through various channels. China has also put forward a number of suggestions and proposals for closer East Asian cooperation and participated extensively in both bilateral and multilateral cooperation in the East Asian region.

In the new century, China will, as always, work with other East Asian countries and continue to play her due part for the realization of peace, stability, growth and prosperity in East Asia.