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Foreign Ministry Spokesman Liu Jianchao's Press Conference on 30 June 2005

On the afternoon of June 30, Foreign Ministry Spokesperson Liu Jianchao held a regular press conference.

Liu: Good afternoon, ladies and gentlemen! First of all, I have an announcement to make:

At the invitation of Premier Wen Jiaobao, Prime Minister of Grenada Keith Mitchell will pay an official visit to China from July 7 to 11.

Now I would like to take your questions.

Q: You said on Tuesday that the bid of China National Offshore Oil Company (CNOOC)  to take over Unocal is a normal commercial offer, not a political act. I hope that you could respond to the following questions. How do you explain that the Government controls 75% of CNOOC? How did CNOOC obtain US$7 billion worth of loans for the takeover with no interest or interest rates lower than that in the market? How will China handle Unocal's assets in the US if the acquisition is completed? Does China see energy security issue as a zero-sum game with clear losers or winners? Is the Unocal takeover bid a commercial offer or a strategic deal?

A: Some people view CNOOC's bid to take over Unocal from strategic or political perspectives. But essentially, it is a corporate commercial offer and part of the normal economic and trade exchanges between China and the US. A commercial move as it is should not be affected by political factors.

As for China's energy strategy, you may have noted President Hu Jintao's recent remarks on the energy issue. He spelt out China's energy guidelines, policy and measures. We mainly rely on domestic supply to meet our demand, and rely on capacity-building to address the energy issue. We must, on one hand, explore more energy and, on the other hand, promote energy conservation in society. We also believe that normal international energy cooperation is an important part of international cooperation. We would like to develop energy cooperation with relevant countries and regions on the basis of equality and mutual benefit. You asked whether the energy issue was a "zero-sum game" in which there would be losers and winners. What I wish to say is that China seeks win-win results.

Q: It is reported that Vice Foreign Minister Wu Dawei is visiting South Asia from today on. He may also visit Pakistan and hold consultations with Pakistani officials. Could you brief us on his program and why the visit is important? Will he discuss UN reform with the Pakistani side?

A: Vice Foreign Minister Wu Dawei is visiting South Asia including Pakistan for diplomatic consultations. He will exchange views with counterparts in South Asian countries on how to deepen bilateral cooperation in the political and economic, trade and cultural fields. Meanwhile, Vice Foreign Minister Wu Dawei will also exchange views with his counterparts on international issues including UN reform.

Q: According to Israeli report that Israel has reached agreement with the US on preventing Israel from selling arms to China. What's China's reaction? Besides, US congressman Henry Hyde submitted a draft resolution on the prevention of EU's arms sales to China. What's your comment on this?

A: China's cooperation with relevant countries in every field is mutually beneficial and conducive to regional peace and stability. Such cooperation is not directed against any third country including the US. Therefore, we hope the US will not interfere willfully or make irresponsible remarks. Such behavior is totally senseless and we are firmed opposed to it. The US side should abandon the cold-war mentality and stop impeding normal exchanges and cooperation between China and other countries. At the same time, we hope that countries concerned will engage independently in mutually beneficial cooperation with China in all fields.

Q: What is the time that China plans for commercial exploration of oil and gas in the East China Sea? Is it August or October? Why is China going to proceed as planned when there is no agreement with Japan on the relevant issues and consultation is to continue?

A: China and Japan have not agreed on the demarcation of the East China Sea. There are still disputes. China has consistently stood for a settlement through consultation and dialogue in the spirit of "shelving differences and seeking common development". In our opinion, such a proposition serves stability in the East China Sea and prevents the escalation of conflict. Moreover, it is an effective avenue to mutual benefits. China and Japan will have more consultations on this issue. I reiterate that China's survey and exploration are totally within indisputable Chinese water.

Q: China has built two dams on the Lancang River. Will it build another 12 new dams? Will it affect the five countries in the lower reach of the River (Mekong River)? How will China explain to the downstream countries?

A: I'm not very clear about details on China's hydro projects in Lancang River. But in terms of cooperation between China and the relevant downstream countries, China always informs them before taking any measures or actions that may affect them. Meanwhile, China gives full consideration to the interests of downstream countries when planning for hydro works. We have done nothing that negatively affects the interests of the downstream countries. China's sincere attitude has won the understanding and trust of more and more downstream countries.

Q: Regarding Taiwan's fishing boat approaching the Diaoyu Island, how would the Mainland react if Taiwan enters into direct "official" negotiations with Japan on this matter? You mentioned that China is opposed to Japan dispelling Taiwan fishing boats. What actions will China take to protect Taiwan fishermen?

A: The Chinese Government attaches great importance to safeguarding the legitimate rights of Chinese fishermen including those in Taiwan. China and Japan have signed the fishery agreement, in which proper arrangement has been made for the fishery issues concerning Taiwan, which is part of China. China and Japan should therefore act in accordance with the terms of the agreement. If the Japanese side enters into fishery negotiations with the Taiwan authorities, it will violate the One China principle and contradict with the principles of the China-Japan fishery agreement. China will be strongly opposed to that. China also expresses strong dissatisfaction to Japan's coercive dispelling of fishermen who were conducting normal operations in the Chinese territorial waters of the Diaoyu Island. We are keeping a close watch on the development of the situation. We urge the Japanese side to pay attention to the concern of the Chinese side and handle relevant issues properly and prudently.

Q: DPRK's Deputy Director-General for North American Affairs Li Gun is about to attend a symposium in New York on international relations in Northeast Asia, during which the US and DPRK may conduct direct dialogues. What expectation does China have on it? Are there any plans of mutual official visit between China and the DPRK?

A: As for the symposium to be held in New York, we have noticed that the parties concerned have indicated that they expect the US and DPRK to contact each other on that occasion. If such contact is achieved, it will be a continuation of the recent contacts between the US and DPRK. Recently both the US and DPRK have made some positive gestures on the resumption of the Six-Party Talks. We hope that the US and DPRK will continue to move forward and create more favorable conditions and atmosphere for the resumption of the Six-Party Talks on the nuclear issue on the Korean Peninsula. As far as I know, officials from the Chinese embassy to the US will also attend the symposium.

As for your second question, the Chinese side has always been making concrete efforts for the resumption of the Six-Party Talks and will continue to do so. I will keep you well-informed if there is any new development.

Q: It is said that the DPRK will rebuild two nuclear reactors. How will China react to it? According to the report, in order to contain China, the US has decided not to cut down its troops stationed in Japan. What's China's comment? It is also reported that China and Japan will jointly hold a maritime rescue drill. Please confirm it.

A: As to the first question, I have no knowledge of the specific situation, and the news still needs to be confirmed. However, under the current circumstances, I hope all relevant parties will do more to facilitate the early resumption of the Six-Party Talks, and will work to create a good atmosphere and condition for it.

As to your second question, what China follows is the road of peaceful development. China's development will pose no threat to any other country, not to the US or Japan definitely. It is unnecessary for some people to be worried about China's development. We hope the US will play a positive, peaceful, and constructive role in the Asia-Pacific region, abandon the Cold-War mentality, and properly handle the relations with and issues concerning countries in Northeast Asia by proceeding from a new security concept of mutual benefit, mutual trust, equality and coordination.

As to the third question, China, together with Japan and the ROK, will hold a maritime rescue drill on July 7th. The news was released already. We know some foreign correspondents in China hope to go and cover the exercise. We are making arrangements for that.

Q: Do you have any news about US Secretary of State Rice's visit to China? Early this week, the Taiwan Affairs Office of the State Council refuted Chen Shuibian's idea of meeting with President Hu Jintao in Washington. What's the ideal role for the US to play in the Taiwan Strait relations?

A: China and the US have maintained high-level exchanges and communication. We will keep you informed of the new development, if any.

As to the second question, we have reiterated on many occasions that safeguarding the peace and stability of the Taiwan Straits and opposing to Taiwan independence conforms to the common interests of both China and the US. We hope the US will truly abide by the one China principle and the three China-US joint Communiqués, honor its commitments of opposing Taiwan independence, and play a constructive role that facilitates peace and stability in the Taiwan Straits.

Q: It is reported that the Japanese Government has given Teikoku Oil the right to begin drilling for natural gas and oil in the East China Sea. What's the comment of the Chinese side?

A: The East China Sea has yet to be demarcated by China and Japan, and the two countries are now divided on the issue. China has all along stood for proper settlement of the issue through dialogue and coordination. Pending that, neither side should take any unilateral moves. China' proposition on settlement of the demarcation question is "shelving disputes and conducting joint development". As such a proposition helps safeguard the stability of the East China Sea, avoid escalation of the contention, and is conducive to a mutually-beneficial and win-win situation, the Japanese side should welcome and attach importance to it. China and Japan will continue their negotiation on relevant issues.

If there is no more questions, the press conference is over. Thank you!

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