Beijing (China Daily/ANN) - China cannot
use its foreign exchange reserves to rescue other countries, Vice Foreign
Minister Fu Ying said on Friday.
"The argument that China should rescue
Europe does not stand, as reserves are not managed that way," Fu said.
She stressed that China's US$3.2 trillion in
foreign reserves should be managed under the principles of "safety,
liquidity and proper profitability".
"China's purchases of European bonds,
International Monetary Fund bonds and US bonds are also based on those
principles," Fu said.
There are many misunderstandings about the use
of China's foreign reserves, she said.
"Foreign reserves aren't domestic income
or money that can be disposed of by the premier or finance minister," Fu
said. "Foreign reserves are akin to savings, and their liquidity and
safety should be ensured."
Since the outbreak of the European financial
crisis, China has increased its imports from the continent, with trade volumes
up 20 per cent over last year, Fu said.
"China is not absent from international
efforts to rescue Europe. It has been a positive and healthy participant,"
Fu said.
She also said that China's investment in
Europe should be de-politicised, adding that China will not seek power and
interests through financial means.
"Successful investment should be
reciprocal. We hope our economic activities are not interpreted from a
political prospective and are not imbued with political interests. We should
follow market economy principles," said Fu.
She was disparaging of a trend arising from
the global financial crisis in the Western community that politicised issues
concerning China.
"We should treat each other with a
moderate and impartial mentality. That will make bilateral relations easier to
handle," Fu said.
Feng Zhongping, director of the Institute of
European Studies at the China Institutes of Contemporary International
Relations, said it is impossible for China to save Europe, but help from China
is vital.
He said economic cooperation between the two
sides should be in line with economic principles, so the priority of China's
investment in Europe is to ensure the safety of its capital.
"Whether China should buy more European
bonds depends on the evaluation of the future of those bonds," Feng said,
"while China can invest more in infrastructure construction and property
in Europe."
Feng said one of the reasons for politicising
bilateral cooperation is mistrust from Europe that China might take control of
it as a debtor.
He Maochun, professor with the Institute of
International Studies of Tsinghua University, said the potential of more
cooperation between the two sides outweighs misunderstanding and conflicts, but
mutual respect and recognition should be achieved.
"Different economies should respect each
other and it's unfair that advanced economies require developing ones to apply
the same standards," he added.
Fu added that the cooperation between China
and Europe is mutually beneficial and their interests have been deeply
intertwined, so China will continue to support Europe.
She said the right choice for Europe now is to
accept and welcome the rise of newly industrialised countries and gain new
motivation for growth from them.
Europe has become China's biggest trade
partner and is also the most important source of technology and one of the
major investors in China.
In return, China imports more than $100
billion annually from Europe and has created more than 1 million local jobs
since China joined the World Trade Organisation in 2001.
Li Lianxing in Beijing/China Daily | ANN
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