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Joint Press Conference with His Excellency Li Keqiang, Premier of the State Council of the People's Republic of China: Parliament House, Canberra: 24 March 2017



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THE HON. MALCOLM TURNBULL MP PRIME MINISTER

TRANSCRIPT

24 March 2017

Joint Press Conference with His Excellency Li Keqiang, Premier of the State Council of the People’s Republic of China

Parliament House, Canberra

E&OE…

PRIME MINISTER:

Good morning. Well we’ve had very, very constructive discussions, the Premier and I and our Ministers and we are delighted to host the Premier and his wife Professor Cheng Hong here in Australia.

This is the Premier’s first visit as Premier coinciding with the 45th Anniversary of Australia-China diplomatic relations. Premier Li is an old friend to Australia. He has visited every decade since the 1990s.

In addition to being a lawyer, he is of course an accomplished economist and he is now overseeing the entire Chinese Economy. He has made an enourmous contribution to China's extraordinary rise.

The Australia-China relationship has also seen incredible growth since the establishment of diplomatic relations so many years ago. And this visit provides the opportunity to reflect on our achievements over 45 years and map a future course for our relationship. In our meeting this morning, it was clear we have a strong set of common interests which we pursue for the benefit of both nations. During this visit, as you have seen, Chinese and Australian companies have signed deals which will contribute billions to our economies and create thousands of jobs.

China and Australia are long-standing reliable economic partners, with complimentary economies. China is our largest trading partner. Two-way trade in 2015-16 was worth $150 billion. Australian exports play a major role, supporting China's growth.

Increasingly our universities and our services sector are also supporting China as its economy transitions under Premier Li and President Xi's leadership. Our high-quality clean, green agricultural produce supports China's food security.

So, today I'm pleased to announce with the Premier that China has agreed to expand opportunities for our meat exporters. The finalised major agreements in agriculture include a meat export package which expands chilled meat access from 11 exporters to all eligible Australian exporters. Australia is the only country in the world with this market access.

Australian chilled beef exports to China are already worth $400 million a year. And more companies will also be eligible to export frozen beef. Total beef exports, overall, are worth around a billion dollars a year. This new agreement will drive significant future growth.

We continue to welcome investment from China with the stock, the foreign direct investment growing to $35 million by the end of 2015. Australia's stock of direct investment in China has grown from $847 million in 2005 to $14 billion in 2015.

With the China-Australia Free Trade Agreement we've further increased those economic opportunities and we are already seeing excellent uptake with more than 85 per cent of eligible goods accessing lower tariffs in both directions.

We can see the results for our farmers, small businesses and industries.

In 2016 wine exports to China were up 38 per cent to $470 million, skin care exports up 82 per cent, fresh oranges up 46 per cent, and Chinese imports of Australian lobster quadrupled.

Earlier today, as we have seen, we have witnessed the signing of a major commercial deal between the Australian DBI Group and China's State Construction Engineering Corporation [inaudible] worth billions.

The companies will invest $6 billion to develop the Balla Balla line, 162 kilometres of railway and an iron ore export facility up to Balla Balla port in the Pilbara, creating around 3,300 jobs.

But we're not content to stand still. As China transitions to a consumer-driven economy, Australia is well placed to meet Chinese demands for high quality, safe food, beverages, consumer items and services. That is why we have agreed to bring forward the review of ChAFTA's services and investment chapters.

There are increasing opportunities in China for our health and aged care providers, universities, and professional service firms. China's transition to an economy that is led by consumers, consumption, is an enormous opportunity for Australian exporters, for Australian businesses, in every field.

Australia already, as I noted yesterday, is one of China's top research partners, and we both see innovation as a major driver of economic growth. In fact, innovation is a core element in both China and Australia's economic strategy. So I'm delighted that the first Australian start-ups have got down to work at the Innovation Landing Pad that we established in Shanghai. That connects them to Chinese investors, technology partners and markets. We're establishing a ministerial dialogue on innovation. It is one of those areas where collaboration is an absolute win-win. The more you work together, the more both sides benefit. It is a very, very, large opportunity for us. The ability to collaborate in innovation around the world, but particularly between Australia and China is enormous. It has so much further to go, and we were talking about it, some great examples of that only this morning.

We're very committed to, as you know, free trade and open markets. We recognise there is a protectionist sentiment in many parts of the world. As I said before at Guangzhou at the G20, protectionism is not the ladder to get you out of the low-growth trap. In fact, it is a big shovel to dig it a lot deeper. So, we welcome President Xi's recent statements, notably his speech at Davos, on the importance of free trade and open markets. Of course, our two countries are manifestly great beneficiaries of that.

We've agreed that we will continue to promote liberalisation in our region, and work to conclude the most ambitious regional comprehensive economic partnership possible. We've also discussed with

Premier Li the significance for China and indeed, for the world of his being able to implement the economic reform plans he laid out most recently in his report.

As our relationship matures, we are expanding cooperation in many other ways. We can announce today we will expand our presence across China, with the opening of a new Consulate General in Shenyang in 2018. I should pay a visit, Premier, to the Consulate in Shenyang. The last time I was there, I think, was in 1993. I am sure there's been a lot of progress and development since then.

We are partnering with China in this, the 2017 year of tourism, China-Australia tourism. We've had 1.2 million visits from China and 455,000 Australians visiting China in 2016. So, those people-to-people links are so valuable.

We are strengthening the educational links. There are already about 157,000 Chinese students studying in Australia, and more Australian students studying in China every year, close to 5,000 there last year.

We have witnessed the signing of an MOU on vocational education and training and agreed today to work together more closely on energy security. The Premier and I have had a good discussion about the - both the engineering and economics of hydroelectricity and there will be a Ministerial Energy Dialogue to drive cooperation on energy investment, security and technology. Again it's a very exciting field where we have a lot to learn from each other and many areas in which we can cooperate.

Working together, our law enforcement agencies are disrupting the methamphetamine trade, with seizures of 8 tonnes of narcotics and precursor chemicals since November 2015. Today we are announcing an Australia-China High-Level Security Dialogue focused on issues such as cyber security, transnational crime and counterterrorism.

The Premier and I discussed the regional security issues, and the importance of maintaining the international rules-based order that has been so important for peace in our region. We've discussed the critical threat posed by the DPRK - North Korea - and the need for action to curtail its nuclear program. And we welcome China's decision to freeze North Korean coal imports in line with the United Nations Security Council resolutions.

Later today, we will be attending the state and provincial forum, bringing together Premiers, Chief Ministers, and eight provincial governors. We will engage with the sixth Australia-China CEO Round Table and talk with business leaders about how we can help them bolster growth between our two countries.

Premier Li will get his first taste of Australian Football when Port Adelaide plays the Swans on Saturday, as a prelude to the first AFL Premiership Season match in China in May.

So today we have made significant advances in our comprehensive strategic partnership with real benefits for both our peoples. We are building on ChAFTA, expanding trade, and increasing government and business ties and people-to-people ties.

It's been a very good visit. Premier Li, we have more engagement to go. We are delighted you are here with your wife Professor Cheng Hong and it is my pleasure now to invite you to address us.

PREMIER OF THE PEOPLE’S REPUBLIC OF CHINA:

[Chinese travelling party to distribute translated remarks]

PRIME MINISTER:

Thank you very much, Premier Li.

I think we have some questions. I think the first question is from the Australian side, I believe?

JOURNALIST:

Thank you. Andrew Tillett from The West Australian newspaper. Welcome to Australia, Premier. I hope you are enjoying you stay.

You spoke yesterday in your address here about the importance of Australia not taking sides in disputes between the US and China. But China's ongoing reclamation and militarisation of the South China Sea remains a major source of regional tension. Shouldn't China show some goodwill and abandon its construction program as a sign of its commitment to regional peace and stability that everyone says they desire?

Our Foreign Minister Julie Bishop made a speech in Singapore recently, arguing that the embrace of liberal democratic values and institutions is the most successful approach to achieving economic prosperity and social stability. Is that seen as an example of Australia taking sides against China?

PREMIER OF THE PEOPLE’S REPUBLIC OF CHINA - TRANSLATION:

Speaking about this before the press conference starts, Prime Minister Turnbull would be the first to answer questions from the Australian side but it seems that question is directed to me, so would it be fine for me to take up this question first?

First of all, South China Sea has all along been peaceful and stable. In last year alone, as many as up to 100,000 commercial ships sailed through the sea lanes of the South China Sea. There was no incident of attacks against those commercial ships. And even any, we heard little about any piracy attacks against these fleets.

At the same time, we believe that it is the responsibility of all countries in this region to work together to maintain peace and stability in the South China Sea and uphold freedom of navigation and overflight.

With respect to the so-called militarisation, China never has any intention to engage in militarisation in the South China Sea. China's facilities, Chinese islands and reefs, are primarily for civilian purposes, and even if there is a certain amount of defence equipment or facilities, it is for maintaining the freedom of navigation and overflight in South China Sea because without such freedom, or without stability in the South China Sea, the Chinese side would be among the first to bear the brunt of it.

The logic is very simple here. A large part of the aircraft and the ships that sail through or fly over the South China Sea are engaged in China's trade with other countries and regions in the world. China is the largest trader of goods in the world, so one can easily imagine how many Chinese interests are at stake here.

Some countries in the South China Sea, China included, may have some disputes between them, regarding islands and reefs and their adjacent waters. In the DOC, the Declaration of Conduct in the South China Sea reached between China and ASEAN countries, it is clearly stated that the relevant disputes should be peacefully resolved - directly by the parties concerned through dialogue and now China and ASEAN countries are also actively pursuing consultation on a Code of Conduct, on the COC in

the South China Sea. All these are for upholding stability in the South China Sea and the freedom of navigation and overflight there. So we hope that the market and the business communities will continue to have strong faith in the South China Sea in the sea lanes with free passage to pursue more free trade.

As for China-US relations and China-Australia relations, China pursues an independent foreign policy of peace and we know that Australia also decides its own foreign policy in the light of Australia's national conditions. We hope that China-Australia cooperation will not just do good to our two countries, but also bring good to other countries. This cooperation will not bring harm to other countries, still less will this cooperation be targeted at any third party. We believe that we are both guided by the vision of global peace, regional stability, and free trade, and we will each make our own decisions on the merits of each case. There is no such issue as taking sides.

It is China's consistent position that all countries, big or small, are equal members of the world, and there needs to be mutual respect and cooperation on an equal footing. There should be no such practice in which the bigger or stronger countries bully the smaller, or weaker ones. For China and ASEAN countries, there has all along been equal cooperation. China may be bigger in terms of its size and population, but we have all along embraced equal cooperation and consultation with ASEAN countries. In cooperation with ASEAN countries, it is also China's consistent position that it supports ASEAN's centrality in regional cooperation. I believe these show China's open and inclusive approach.

We believe that all countries have the right to decide their own path [inaudible] in keeping with their respective national convictions.

Yesterday at the welcome luncheon hosted by Prime Minister Turnbull, my deep impression was that we were led onto stage by a member of Aboriginal representatives and the first who addressed the floor was the Aboriginal elder and I also recall that Prime Minister Turnbull opened his welcoming address by paying respect to the Aboriginal elder. For that left a deep impression on my mind of Australia’s diversity of civilization and culture. We believe that we should have a multicoloured world and through pluralism of culture and civilisations otherwise the world would be such a boring place. The good thing is that Australia is a place well known for its diversity.

China, likewise is also a country with a great deal of diversity, and maybe as a journalist one day you come to China and you can also feel it for yourself and feel that we live in a happy place.

PRIME MINISTER:

That was a very generous, comprehensive answer.

Let me make a couple of observations, just very briefly. You asked about the regional security and the South China Sea in particular.

Our position has been, is and has always been, very consistent. We are not a claimant to any of the disputed territories or features in the South China Sea.

We urge all parties to resolve differences peacefully by negotiation in accordance with international law.

We look forward to the Code of Conduct that the Premier referred to, with ASEAN being concluded.

We encourage all parties to refrain from taking any actions, which would add to tensions, including actions of militarisation of disputed features.

And the Premier spoke about mutual respect. That is the foundation of peace and stability in the world, just as it is the foundation of harmony within a nation and within ours, the most successful multicultural society in the world.

We are proud of the extraordinary democratic parliamentary tradition of our nation. Yesterday, we stood in solidarity with the people of Britain, when the mother of parliaments itself was attacked by a terrorist.

We condemn that act, we defy the terrorists, we defy those who challenge our freedoms and we stand together in defiance of those who seek to undo liberties that have been established by generations that have come before us, both here and in the United Kingdom where our parliamentary traditions began.

China's history, 3,000 years of civilisation, is so remarkable.

PREMIER OF THE PEOPLE’S REPUBLIC OF CHINA:

5,000.

PRIME MINISTER:

5,000 years?

(Laughter)

There you go! So remarkable!

We respect the sovereignty and the traditions of China, as China respects ours. The extraordinary achievements of China in the last few generations have astounded the world, surprised the world.

Who would have thought what extraordinary economic progress would come from that decision of Deng Xiaoping to open China to the world, following, as we said yesterday, the example of the great navigator Zheng He.

China has astounded the world with its development in years past. I have no doubt it will do so in the years to come.

Thank you. Now do we have a question from the Chinese side?

JOURNALIST - TRANSLATION:

China Central Television. A question now for Prime Minister Turnbull.

Mr Prime Minister, recently there has been a heated debate in Australia about Australia's foreign policy. One of the important aspects of this debate is how should Australia position its relations with China. Some people suggest that Australia should consider striking a new balance between China and the United States, or even go further to suggest that Australia should prioritise its relations with China over that with the United States.

Can we have your perspective on that?

PRIME MINISTER:

Thank you very much for your question.

I'm not sure that I agree with you that there has been such a heated debate about this. But we have a staunch, strong ally in Washington, a good friend in Washington, and we have a very good friend in Beijing.

The idea that Australia has to choose between China and the United States is not correct.

The bilateral relationship between China and the United States is the single most important one for the prosperity and security and stability of the world.

The fact that we have very strong relationships, but different relationships - different in context and in terms of history - with both the United States and China, that is a great strength.

So, we see our very strong ties with the United States, strengthening our very strong security alliance with the United States, strengthening our very strong friendship and our dialogue and our partnership with China strengthening too. So, it's not a choice. It’s a multipolar world and we all have a great deal to contribute to that objective of peace and stability because from that, built on that foundation of security, comes the opportunities and the growth and the ability for our children and grandchildren to realise their dreams, to do even more than their parents could ever imagine.

PREMIER OF THE PEOPLE’S REPUBLIC OF CHINA - TRANSLATION:

I fully agree with what Prime Minister Turnbull has just said. We are talking about China-Australia relations and cooperation and I just don't know why it seems that many questions have much to do with a third party.

But let me say that, as I already mentioned, we believe China-Australia cooperation will bring good to other countries and regions, and this cooperation will not be targeted at any third party.

We believe that all parties have the obligation to work together to maintain global peace and regional stability.

About the situation on the Korean Peninsula, for example, China has a consistent position that China is committed to the de-nuclearisation of the Korean Peninsula and peace and stability on the peninsula and resolving issues through dialogue. The situation there has indeed become quite tense so we hope all parties concerned will work together to deescalate the situation and uphold regional stability because any instability in the region will only bring harm to the parties involved.

China, on its part, will continue to do its utmost to work in that direction. We hope that the relevant parties will have direct dialogue, dialogue like mutual respect - one principle that we should all observe and China’s also fully compliant with the UN Security Council resolutions.

PRIME MINISTER:

Very good. Thank you all very much.

[ENDS]