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### Viewing cable 07BEIJING1795, MARCH 16 PREMIER WEN JIABAO NPC PRESS CONFERENCE:

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Reference ID | Created | Released | Classification | Origin
--- | --- | --- | --- | ---
07BEIJING1795 | 2007-03-16 15:12 | 2011-08-23 00:00 | UNCLASSIFIED | Embassy Beijing

`

    VZCZCXRO7786
    OO RUEHCN RUEHGH RUEHVC
    DE RUEHBJ #1795/01 0751512
    ZNR UUUUU ZZH
    O 161512Z MAR 07
    FM AMEMBASSY BEIJING
    TO RUEHC/SECSTATE WASHDC IMMEDIATE 5795
    INFO RUEHOO/CHINA POSTS COLLECTIVE

` `

    UNCLAS SECTION 01 OF 03 BEIJING 001795

    SIPDIS

    SIPDIS

    E.O. 12958: N/A
    TAGS: PREL PGOV PHUM MARR CH JA TW KN
    SUBJECT: MARCH 16 PREMIER WEN JIABAO NPC PRESS CONFERENCE:
    ASAT/MILITARY SPENDING, TIBET, TAIWAN, JAPAN, HONG KONG,
    GROWTH, CAPITAL MARKETS, FOREIGN RESERVES

    SUMMARY
    -------

    ¶1. At his March 16 press conference immediately following
    conclusion of the National People's Congress (NPC), Premier
    Wen Jiabao made the following key points:

    -- China's anti-satellite (ASAT) test was neither aimed at
    nor threatened any country and did not violate any
    international treaties.  The PRC's position in support of the
    peaceful use of, and opposition to an arms race in, space
    remains unchanged.

    -- China's security policy is defensive in nature.  The PRC
    is committed to the path of peaceful development and
    maintains a limited military to safeguard China's security,
    independence and sovereignty.

    -- If Prime Minister Abe's visit to China last October was an
    "ice-breaker," Premier Wen hopes his visit to Japan in April
    will be an "ice-melter."  During the visit, consensus will be
    reached on establishing strategic and mutually beneficial
    relations.  The PRC sympathizes with the Japanese abduction
    issue but believes it is an issue between Japan and North
    Korea.

    -- The "door is always open" to dialogue with the Dalai Lama,
    as long as he recognizes that Tibet, and Taiwan, are
    inalienable parts of China's territory and abandons his
    separatist activities.

    -- The PRC firmly opposes Taiwan secessionist activities of
    any form, such as promoting "de jure" independence.

    -- Democracy, the rule of law, freedom, human rights,
    equality and fraternity are not peculiar to capitalism but
    are common values of mankind.  China will promote political
    system reform and build democracy in its own way, according
    to its unique national conditions.

    Comment:  Some 700 journalists attended the Premier's
    standing-room-only press conference.  Wen broke little new
    ground but answered questions for nearly two hours, coming
    across as warm, open and well-briefed on a range of issues,
    including hard questions on democracy, the Dalai Lama and
    China's military spending.  END SUMMARY AND COMMENT.

    Closing the NPC:  Focus on the People
    -------------------------------------

    ¶2.  At his press conference immediately following the
    conclusion of the NPC, Premier Wen began by thanking citizens
    across China for their attention to the "Two Meetings" (the
    National People's Congress (NPC) and Chinese People's
    Political Consultative Conference (CPPCC)), especially the
    more than 10,000 questions posed by "netizens" to the Premier
    online.  The Premier said he took time to read and consider
    some of the questions raised in these online forums.  Over
    the past four years, the government has learned that all
    power of the government is given by the people and all power
    belongs to the people; everything it does must be for the
    people, it must rely on the people and must attribute all
    achievements to the people.

    ASAT Test, Military Buildup:  Not a Threat
    ------------------------------------------

    ¶3.  Asked to respond to the seeming contradiction between
    China's anti-satellite (ASAT) test and increased military
    expenditures with China's self-expressed peaceful rise and
    development, Premier Wen said the test was neither aimed at
    nor threatened any country and did not violate any
    international treaties.  The PRC's position in support of the
    peaceful use of, and opposition to an arms race in, space
    remains unchanged.  He called on relevant countries to sign
    an agreement on the peaceful use of space at an early date.
    China's security policy is defensive in nature.  Because of
    its geographic position and painful historical experience,
    the PRC is committed to the path of peaceful development and
    maintains a limited military to safeguard security,
    independence and sovereignty.  On this matter, China has been
    completely transparent.

    Dalai Lama:  Door for Dialogue "Open," but...
    ---------------------------------------------

    ¶4.  In response to the question why the Dalai Lama is still
    considered a "splittist" by the Chinese government even
    though he now claims not to promote Tibetan independence, Wen
    Jiabao urged reporters to observe the Dalai Lama's actions
    rather than simply his words.  The "door is always open" to

    BEIJING 00001795  002 OF 003

    dialogue with the Dalai Lama, as long as he recognizes that
    Tibet, and Taiwan, are inalienable parts of China's territory
    and abandons his separatist activities.  Nevertheless, Wen
    pointed out that the Dalai Lama was chairman of the
    representative committee for Tibet's government in 1956, but
    later chose to go abroad, establish a government in exile,
    advocating a highly autonomous Tibet, the removal of the PLA
    and all non-Tibetan ethnic groups from Tibet.  It therefore
    is not difficult to tell whether the Dalai Lama truly desires
    the nation's unity or wants to sabotage it.

    Taiwan:  Opposing "de jure" Independence
    ----------------------------------------

    ¶5.  On Taiwan, the Premier responded to a Taiwanese reporter
    by saying that the coming two years are crucial for
    cross-Strait relations, emphasizing China's firm opposition
    to Taiwan secessionist activities of any form, such as "de
    jure" independence.  China will never allow anyone to change
    the historical reality and internationally recognized status
    that Taiwan is an inalienable part of China since ancient
    times.  China remains committed to peaceful development
    across the Taiwan Strait.  China will continue to protect the
    lawful rights of the increasing numbers of Taiwan businessmen
    and compatriots on the mainland.  China will promote the
    "three links," resolving the issue of direct charter weekend
    flights direct charter cargo flights.  The mainland hopes to
    realize soon the dream of many mainland tourists to travel to
    Taiwan.

    Japan-China Relations
    ---------------------

    ¶6.  If Prime Minister Abe's visit to China last October was
    an "ice-breaker," Premier Wen hopes his visit to Japan in
    April will be an "ice-melter."  During the visit, consensus
    will be reached on establishing strategic and mutually
    beneficial relations.  The PRC sympathizes with the Japanese
    abduction issue but believes it is an issue between Japan and
    North Korea.  The Three Political Documents are the
    foundation for the development of China-Japan relations.  We
    must uphold the spirit of these three documents and view
    history as a mirror while looking forward to the future.

    Hong Kong
    ---------

    ¶7.  Over the past 10 years since Hong Kong was returned to
    the motherland, China has strictly followed the Basic Law,
    implementing the one country, two systems policy and not
    intervening in the internal affairs of the Hong Kong
    government SAR.  Wen drew attention to Hong Kong's successful
    rebound from the 1997 financial crisis and the SAR's
    irreplaceable economic role.

    Socialist Democracy
    -------------------

    ¶8.  A reporter from Le Monde asked the Premier a) whether his
    recent Renmin Ribao article about China being in the initial
    stage of socialism meant that China would have no democracy
    for 100 years, and b) for his comment on Zhao Ziyang's recent
    memoir which calls for China to democratize in order to
    modernize.  In reply, Wen said that, in his article, he said
    socialism and democracy are not incompatible.  Democracy, the
    rule of law, freedom, human rights, equality and fraternity
    are not peculiar to capitalism but are common values of
    mankind.  China will promote political system reform and
    build democracy in its own way, according to its unique
    national conditions.

    ¶9.  It would be a misunderstanding to think that my article
    implied that China would not want democracy for 100 years.
    At this stage, we must accomplish two major tasks and two
    major reforms.  The two major tasks are first, concentrate on
    developing social productive forces; second, promote social
    fairness and justice.  The two reforms are to promote
    economic reform with marketization as the goal; and to
    promote reform of the political system with democratization
    as the goal.  As for the book mentioned by the reporter, Wen
    said he had not read it and that it had nothing to do with
    his aforementioned views.

    Economic Growth, Environmental Problems
    ---------------------------------------

    ¶10.  Addressing the ability of the Chinese economy to sustain
    its high rate of growth, Premier Wen said China faces many
    challenges, but so long as the international environment is
    peaceful, he is confident they can be overcome.  Challenges
    include market instability, regional development disparities,

    BEIJING 00001795  003 OF 003

    lack of coordinationand reliance on foreign investment and
    exports to drive growth.  Areas for improvement include
    increasing consumer demand, strengthening the knowledge
    economy, and removing obstacles for greater reform and
    opening.

    ¶11.  Regarding the issues of increasing energy efficiency and
    controlling pollution, Premier Wen referred reporters to his
    eight points in his work report delivered to the NPC.
    Regarding China's stance on greenhouse gases, Wen said that
    China endorses the Kyoto Protocol.  Although a developing
    country not bound by the Protocol's mandatory targets, China
    has nonetheless established its own national plan which
    includes a 20 percent energy consumption reduction per unit
    of GDP by 2010.

    Stock Market, Foreign Reserves
    ------------------------------

    ¶12.  Premier Wen said he pays attention to the development of
    the stock market but pays even more attention to the stock
    market's health.  Since last year, the government has
    strengthened capital market institutions and promoted
    stockholder reform.  To establish a mature capital market,
    China must improve the quality of its listed companies,
    increase openness, fairness and transparency, while at the
    same time raising awareness among investors of the risks and
    exposure in the market.  Turning to the
    soon-to-be-established institution in charge of investing
    China's foreign exchange reserves, Wen said the agency will
    not be affiliated with any government ministry or department
    and will follow market rules and regulations.  The Premier
    stressed that China's non-financial outbound investment
    account of USD 73.3 billion is still relatively small.  China
    will handle buying USD-denominated assets on the basis of
    mutual benefit, said Wen, maintaining this development would
    not relevantly impact the value of USD-denominated assets.
    RANDT

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